Introduction: Lord Mogg

Lord Mogg—Sir John Frederick Mogg KCMG, having been created Baron Mogg, of Queen's Park in the County of East Sussex, for life, was introduced between the Lord Bassam of Brighton and the Lord Brittan of Spennithorne, and made the solemn affirmation.

Health: Chronic Fatigue Syndrome/Myalgic Encephalomyelitis

The Countess of Mar: asked Her Majesty's Government:
	Whether the current NHS review will include consideration of chronic fatigue syndrome/ myalgic encephalomyelitis (CFS/ME) as a long-term neurological condition.

Lord Darzi of Denham: My Lords, the Government recognise that CFS/ME is a poorly understood condition that can be very distressing to patients, their families and carers. The long-term conditions pathway is one of the care pathways that strategic health authorities are examining as part of the NHS next stage review. The review, which is being led by local multidisciplinary working groups, will increase awareness and ensure better care for people with CFS/ME and will help to support local delivery of the NSF for long-term neurological conditions.

The Countess of Mar: My Lords, I thank the Minister for that reply. Does he appreciate that, despite the fact that it has been 40 years since the World Health Organisation recognised ME as a neurological disease and 20 years since the Department of Health did so, adults are still sectioned or deemed as lacking in capacity and children whose parents are blamed for their illness are put on the at-risk register or are made wards of court, with people from both these groups forcibly put into mental hospitals? This has been described to me as abuse by professionals. What has been the outcome of the CMO's 2002 recommendations on the £8.5 million supposedly spent on CFS/ME, which has apparently come to nothing, and what will happen in the future?

Lord Darzi of Denham: My Lords, the Government accept the World Health Organisation's classification of CFS/ME as a neurological condition of an unknown cause. My ministerial colleague Ann Keen reaffirmed that position at the meeting of the All-Party Parliamentary Group on ME in January of this year. Subsequent to the CMO's report, the Government allocated funding of £8.5 million for two years, 2004-05 and 2005-06, to set up specialist CFS/ME services where none existed previously. These centres, of which there are 13 across the country, would improve services for those with CFS/ME.

Baroness Tonge: My Lords, when I was a student, I had a professor who, when asked the cause of a very difficult disease, would usually reply, "Nobody knows, tiddly-pom". I suspect that ME falls into the "nobody knows" category. It is welcome news that pathways are being set up to look at this condition and to decide what is to be done in the health service, but how long will it be before the condition is taken seriously and protocols are in place to deal with the very real consequences for patients of this disease?

Lord Darzi of Denham: My Lords, I thank the noble Baroness for acknowledging that for many years there has been a heated debate about CFS/ME among researchers, practitioners and patients. In fact, few illnesses have been discussed so extensively. The underlying issue is whether more research and development should be undertaken in this field not just on the symptomatology but on a diagnostic test so that we can at least plan different treatment protocols. In August 2007, NICE looked at the evidence relating to treatment protocols and recommended cognitive behavioural therapy and graded exercise therapy, as there was some evidence to support their suitability in the treatment of this condition.

Lord Swinfen: My Lords, so far as I could hear, the Minister failed to respond to the noble Countess's point on patients with this disease being sectioned and children being put into care as a result. Would he be good enough to do so now?

Lord Darzi of Denham: My Lords, I have acknowledged that CFS/ME is a neurological condition, but I am not aware of the circumstances in which associated illnesses might require sectioning. The noble Countess wrote to me about one specific case and I shall respond in relation to that.

Baroness Howe of Idlicote: My Lords, can the Minister explain to the House why the Royal College of General Practitioners continues to insist on categorising CFS as a mental illness?

Lord Darzi of Denham: My Lords, the Government have made it clear that they consider that CFS/ME should be classified as a neurological condition. It is for professional bodies to look at the evidence base and I will encourage the Royal College of General Practitioners to look at the WHO classification, which, as I said earlier, is that it is a neurological rather than a mental condition.

Earl Howe: My Lords, is the Minister aware of the work of the charity Tymes Trust—I declare an interest as a patron—which specialises in supporting young people with ME, particularly with regard to their educational needs? Does he agree that recognition of CFS/ME by teachers, social workers and, indeed, GPs is of fundamental importance and that imaginative ways need to be found to help children with ME who cannot cope with mainstream schooling?

Lord Darzi of Denham: My Lords, I am aware of the charitable contributions in this important area. In fact, many charities in this field have contributed to the development of NICE guidelines specifically in relation to children. I could not agree more with the noble Earl in emphasising the importance of engaging the family, the need for a diagnosis to be confirmed by a paediatrician and the need to support a return to education. These guidelines, which were issued as part of the NICE guidelines, have been welcomed by the Association of Young People with ME and provide a positive lever in improving services for children and young people with CFS/ME.

Lord Elystan-Morgan: My Lords, is it not the case that under Section 31 of the Children Act 1989 a child can be placed in care only if he or she is suffering significant harm or is at risk of significant harm and that therefore any connection with ME can only be on the basis of a misdiagnosis?

Lord Darzi of Denham: My Lords, I am very grateful for that intervention.

Schools: Fruit and Vegetable Scheme

Baroness Walmsley: asked Her Majesty's Government:
	Whether they plan to extend the school fruit and vegetable scheme to maintained nursery schools.

Lord Adonis: My Lords, there are no current plans to extend the school fruit and vegetable scheme to maintained nursery schools. Children in under-five settings already receive free milk as part of the nursery milk scheme. That scheme is not restricted to maintained nursery schools but also extends to the private and voluntary sector at a cost, this year, of £27.5 million.

Baroness Walmsley: My Lords, I thank the Minister for his reply. Given what medical science knows about how early food preferences are established in human beings, how can he justify the fact that four year-olds in primary schools are being given the health benefits of free fruit and vegetables while children aged four in maintained nurseries, which are funded from exactly the same funding pot, are not getting that benefit? Is there a sort of postcode lottery? Secondly, will the Minister tell us when the scheme is to be evaluated and what will be the criteria for success?

Lord Adonis: My Lords, the school fruit and vegetable scheme has already been evaluated. An evaluation carried out across 37 schools in north-east England by the National Foundation for Educational Research concluded that the number of children eating their five a day had increased substantially as a result of the scheme. It compared food diaries and questionnaires of more than 1,600 children taking part in the scheme in the north-east in March 2004 with 2,000 different children in November 2006. It found 32 per cent of children eating five portions of fruit and vegetables in 2004 compared with 44 per cent of children in the 2006 study. As the noble Baroness says, the scheme has been successful. However, it is intended for primary schools. The reason why some nursery settings benefit from the scheme is simply because they are attached to primary schools. If we were to extend it to all under-five settings, the cost would rise by about £30 million a year. We do not immediately have those resources available.

The Lord Bishop of Portsmouth: My Lords, without wanting your Lordships' stomachs to rumble unduly, even at this early hour of the afternoon, it is good to note that 440 million pieces of fruit are given to 2 million children in 16,000 schools annually. Given the overall nature of the monitoring to which the Minister has partially alluded in the previous answer, does he agree that that does not actually reveal a great change in dietary habits? Does that not suggest that the scheme needs to be intensified and extended, both upwards and downwards in the age range? Perhaps I should declare an interest as the grandfather of a grandson who goes to nursery school and who has inherited from his grandfather an intense love of fruit-eating of all kinds.

Lord Adonis: My Lords, I am delighted to hear of the right reverend Prelate's hereditary condition. On the impact, if resources were available we would like to be able to extend the scheme, but the scheme costs £41 million a year for primary schools and we do not immediately have the resources available to extend it. However, it is because of the benefits of ensuring that food in schools is healthier that we have carried through the very substantial investment in healthy school meals, including the establishment of the School Food Trust. That has had a beneficial effect on dietary habits in schools.

The Countess of Mar: My Lords, is it not the case that a weaned child introduced at the earliest possible age to a wide variety of fruit and vegetables will probably continue on that path for the rest of his or her life? Is it not, therefore, perhaps more important that children in nurseries are fed a broad spectrum of fruit and vegetables? Perhaps the Minister would consider, with his colleagues, the possibility of transferring the £41 million to nursery children.

Lord Adonis: My Lords, I am not sure that it would be universally popular among primary schools if we were to seek to do that. However, the nursery milk scheme reimburses early years providers for providing free milk daily to children under five attending for two hours or more. That is an important part of ensuring that children are introduced to healthy habits at the earliest possible age. The healthy start scheme also provides free vitamin supplements and weekly vouchers for milk, fresh fruit or vegetables to pregnant women and under-fours in low-income families. That supports half a million women and children a year, so we make a substantial contribution even to the under-fives, but there would be a substantial additional cost if we extended the existing school fruit and vegetable scheme to all under-five settings.

Baroness Oppenheim-Barnes: My Lords, is the Minister aware that if fruit and milk were presented to children at nursery schools in the form of smoothies, that would kill two birds with one stone and be far more palatable to the children?

Lord Adonis: My Lords, what an interesting idea.

Baroness Sharp of Guildford: My Lords, the Minister mentioned the healthy school meals initiative. When will the Government fulfil Ruth Kelly's promise, made when she was Secretary of State, to spend 50p per child per day on school meals for primary schools and 60p per day on ingredients in school meals in secondary schools?

Lord Adonis: My Lords, I cannot, but I should stress that it is not the Government who spend the money on meals in schools; it is the schools themselves which decide how much they spend. We have put substantial additional resources into supporting schools in investing more in the content of school meals, but it is their decision, not ours, how much they spend.

Baroness Howe of Idlicote: My Lords, in light of the fact that the Government are extending nursery places for certain groups of two to three year-olds, can we be reassured that in those circumstances there will be the sort of provision of fruit that has been mentioned?

Lord Adonis: My Lords, the nursery milk scheme will apply to extended settings as well as existing settings. I referred to the healthy start scheme, which provides milk, fresh fruit or vegetables to pregnant women and under-fours in low-income families, which will apply to a substantial number of those two year-olds who benefit from the additional nursery places that we are making available. So there will be some additional provision, but I cannot undertake that those in all additional nursery places will be eligible for fresh fruit and vegetables.

Lord Swinfen: My Lords, what proportion of the fruit and vegetables is grown in the United Kingdom?

Lord Adonis: My Lords, I do not know, but I will write to the noble Lord with the information that we have available.

Planning: Eco-towns

Lord Rotherwick: asked Her Majesty's Government:
	What aspects of planning policy guidance 3 and planning policy statement 3 apply to the planning of eco-towns.

Baroness Andrews: My Lords, planning policy for housing, planning policy statement 3, supports the priority to build more houses across the country by seeking to release more land for housing and prioritising development on brownfield sites. Planning policy statement 3 replaces planning policy guidance 3 on housing. Eco-towns will help us to deal with those challenges, will exemplify genuine sustainable living and will accord with the aims and principles set out in planning policy statement 3.

Lord Rotherwick: My Lords, I thank the noble Baroness for her reply. Why is it, therefore, that Weston Otmoor is being considered as an eco-town when it is not consistent with PPG3, as a large part of it is the grass airfield of RAF Weston on the Green, used for parachute training and for community gliding? Further, surely the proposal is also contrary to PPG17, planning for open spaces, PPG13 for transport, PPG7, sustainable development in rural areas—

Noble Lords: Reading!

Lord Rotherwick: My Lords, I am afraid that this is rather technical and I would not like to get it wrong. Surely it is contrary to PPG2, presumption against development within the green belt. Furthermore, the proposal concerns part of a SSSI. Is not that proposal seriously flaunting the Government's own planning provision?

Baroness Andrews: My Lords, the noble Lord probably knows that those 15 proposals are just potential sites. They were reduced from 57 to reflect areas regarded as sustainable in areas of high housing stress, which the area that the noble Lord is talking about certainly is. On airfields, in which I know that he has a particular interest, there is neither a presumption in favour of development nor a blanket exemption. On the other PPSs that he mentions, when we assess the most likely sites for the five or 10 eco-towns, we will certainly look at all those issues.

Baroness Whitaker: My Lords, to return to the general subject, can my noble friend assure us that the new eco-towns will take advantage of new design opportunities as well as sustainability?

Baroness Andrews: My Lords, I certainly can, because sustainability and design go together. What is interesting about the eco-towns is that we very much want to encourage all sorts of innovation, and design is one of the seven criteria for the eco-towns; it is in the prospectus. The noble Baroness will be particularly pleased to learn that we are working with CABE, RIBA and the Prince's Foundation for the Built Environment to run a design competition and to challenge the standards that must be the very highest for all forms of design.

Lord Naseby: My Lords, can the Minister explain why the Government never learn from their own experience? After all, the most successful new towns were the fourth-generation new towns, which were all attached to existing communities. Surely it is much more preferable to use those existing resources and to build on them rather than on greenfield sites.

Baroness Andrews: My Lords, we have certainly learnt from experience, which is why we will not, for example, build housing estates that do not have community facilities and a community spirit and that were such a problem in the 1960s. We can learn from the new towns, but this is the challenge that we will meet in our generation: to build sustainably and to the highest standards. We will work towards zero carbon, for example. Each eco-town will be exemplary in one particular aspect of environmental sustainability, such as water. We will not build on the green belt. There will be instances where it may be sensible to build on greenfield sites, but most of the 15 sites that have been proposed are brownfield or a mixture of brownfield and greenfield.

Baroness Hamwee: My Lords, does the Minister accept that there may be a danger of losing the support of the public if eco-town proposals are in essence repackaged projects that were rejected on planning grounds? I am thinking particularly of Pembury. On a more technical point, do the Government have a view about the optimum population size of eco-towns, for instance to ensure a good range of employment to reduce travelling elsewhere?

Baroness Andrews: My Lords, we are not looking at failed or recycled schemes. The schemes must be genuinely innovative. On the noble Baroness's point about size, the important thing is that these are new towns, so they must support the population by providing business, employment, retail, community and leisure. This is critical; that test must be satisfied.

Lord Berkeley: My Lords, although I welcome eco-towns generally, will my noble friend assure the House that there will be proper provision of public transport in and to the towns, particularly rail, light rail and trams, which would reduce the carbon footprint significantly?

Baroness Andrews: Yes, my Lords. One of the five key principles is that the towns will be walkable, so by implication we want a high degree of public transport. They will be connected to local settlements. The whole point of them is that they will be sustainable, which means that we must invest in the infrastructure and avoid unnecessary pressure on car ownership and use, not only in the towns but in the surrounding areas.

Baroness O'Cathain: My Lords, will the Minister confirm that the Government are bypassing the local development framework in PPG12—I am sorry to throw another number into the pot—thereby ignoring the requirement on a local authority to use best evidence to decide the strategic location of a development?

Baroness Andrews: My Lords, we are not bypassing the local development planning processes at all. In most cases, local development plans will be in operation. They are the supreme document. We always take material consideration of other planning documents on funding, sustainability or whatever. These towns will be planned within the framework of the planning system, which is very robust. They will be fully consulted on at each stage. Indeed, they are being consulted on at great level now. Evidence is what the planning system is based on.

Lord Marlesford: My Lords, has the Minister considered the possibility that the eco-towns are conceptually unsound and that the new towns built after the war were arguably one of the great errors as they pre-empted resources that should have gone into developing the city centres, a failure from which we have suffered ever since? Many of them, such as Peterlee, were badly designed and shoddily built. Will she at least take comfort from the fact that the welcome shakeout in housing should enable the Government to come to a more realistic assessment of housing demand?

Baroness Andrews: My Lords, we need a balance in our policy for housing the nation. Certainly, something can be learnt from the new towns experience. These eco-towns are not conceptually flawed. They act as exemplars for what we should all realise is the great challenge of our generation to meet sustainability in the face of climate change. On what is happening in the housing market, we cannot sacrifice long-term interests to a short-term difficulty. That would not make houses more affordable or reduce the demand for houses, much of which is being driven by an ageing population.

The Earl of Onslow: My Lords, is not the concept of eco-towns—

Lord Elton: My Lords, can the Minister confirm that, unlike many new developments in the south-west regional strategy, no eco-town will be planned for a flood plain?

Baroness Andrews: My Lords, PPS25 is clear. Although we cannot say that we will never build on flood plains, because of the state of our country and the needs of the population, we have a robust sequential approach for identifying flood risk. The Environment Agency advises us on this. We are in a very much more sensible and clear position with regard to the judgments that we have to make.

Visas: Performing Arts

Lord Low of Dalston: asked Her Majesty's Government:
	What will be the impact on the performing arts of proposed changes to the visa system.

Lord Bassam of Brighton: My Lords, the Home Office published statements of intent setting out the detailed policy for tiers 2 and 5 of the points-based system on 6 May. These were accompanied by full impact assessments. The proposals were developed in close consultation with the Department for Culture, Media and Sport and with key stakeholders in the arts and entertainment sector, including those from the performing arts.

Lord Low of Dalston: My Lords, I thank the Minister for that reply. Of course he will be aware that stakeholders have welcomed the Home Office statement, but he will also be aware that concerns remain regarding the application of a points system to artists. Given all the different categories of artists who will be affected, will he undertake to review the criteria governing tier 2 of the new rules for the issuing of visas to make sure they are neither too restrictive nor too lax? As I understand it, as things stand, even top dancers, for example, will not have enough points for tier 2 status.

Lord Bassam of Brighton: My Lords, I was not aware that top dancers would not have enough points for tier 2 status. However, we keep these matters perpetually under review. We are in close engagement with the arts and culture world, and we are very sensitive to the issue that the noble Lord raises. We would not want to damage in any way the sports and cultural sector. For that reason we made the announcement that we did, and I think it has broadly been welcomed by the cultural and sporting communities.

Lord Clement-Jones: My Lords, I am delighted to hear the Minister's sympathetic noises, and the exception for festivals also is very welcome. However, the fact is that that will cover only a small proportion of performing artists. Visa costs have risen enormously over the past few years. Will not the new tier 5 proposals for overseas nationals add massively to the costs for production companies and cultural organisations and for the performing artists themselves, not least because of the new requirement for sponsorship certificates?

Lord Bassam of Brighton: My Lords, I am not sure that that will be the case, because it will be possible for group certificates to be issued to sponsors. For instance, an orchestra of 100 will need only one sponsorship certificate, at a cost of just £10. So I do not think that the costs will hit the sector in the way in which the noble Lord describes.

Lord Howarth of Newport: My Lords, surely my noble friend is aware that, night after night, throughout the year, concerts of superlative quality are performed in London, Birmingham, Manchester, Liverpool and Newcastle with many musicians coming in from abroad on visas which have been obtained hitherto through a system that has been manageable for all concerned. In increasing the visa costs for a large orchestra by some £15,000, in requiring that every individual musician attend a British consulate in person to obtain a visa and surrender their passport for some days, and in requiring that visas should be renewed after six months, does the Home Office understand that it risks killing one of the cultural glories of this country? My noble friend referred to consultation between the Home Office and DCMS. What advice did DCMS give to the Home Office, and what notice did the Home Office take of that advice?

Lord Bassam of Brighton: My Lords, I am sure that the DCMS advice was listened to very carefully because we, too, are exercised in the way in which the noble Lord describes. As I said, we do not want to undermine the cultural industry in this country or the great benefits of an active sports sector. We carried out a detailed consultation and ensured that we protected the permit-free concession for entertainers, including permit-free festivals and so on. As I understand it, part of the visa fee regime will be reduced from £99 to the current visitor fee of £65 when the process is complete.

Baroness Gardner of Parkes: My Lords, is the Minister aware that many young artists need to be in this country for a certain length of time? I refer in particular to Joan Sutherland, who arrived here as an absolute unknown. Under the present system she could not have stayed here long enough to reach the world status that she has achieved. Should this not be taken into account?

Lord Bassam of Brighton: My Lords, I am sure that that is the sort of issue that is taken into account. The noble Baroness is right to draw attention to the fantastic contribution made not only by Joan Sutherland but by many other individuals who come to the United Kingdom to ply their trade. They give great pleasure to us all.

Lord Dholakia: My Lords, I am grateful to the Minister for clarifying that such groups will form part of the points-based system. Do we have qualified people who can evaluate such group visa applications made from posts abroad?

Lord Bassam of Brighton: My Lords, the quality of our Immigration Service and border security arrangements has been improving so that judgments and assessments are being made much more rapidly and accurately. The system is working well and is much better managed than it has been for a long time.

Viscount Bridgeman: My Lords, we are right in the middle of the festival season and the Edinburgh festival, the largest of them all, will soon be upon us. In view of the question put by the noble Lord, Lord Clement-Jones, can the Minister assure the House that festivals will be specifically exempted from the new regulations?

Lord Bassam of Brighton: My Lords, very detailed negotiations have been going on with the major festivals, and not just with Edinburgh. As the noble Viscount will know, I have a rather strong place in my heart for the Brighton festival. It may not be as big as Edinburgh, but it is certainly moving in that direction. He can rest assured that representations have been made and understood.

Lord Bilimoria: My Lords, the ethnic restaurant industry has contributed a huge amount to this country. Indian food, for example, has become a way of life. However, the industry is seriously concerned about the points-based system, which will make it very difficult to recruit skilled staff. Are the Government aware of this and are they planning to make some exceptions?

Lord Bassam of Brighton: My Lords, the points-based system is designed to benefit migrants with high levels of skill who seek to come to the United Kingdom. I understand that we have not seen any major problems in the highly skilled sector at all. The points-based system, which is based on the Australian model, is fairer, offers a transparent process and ensures that applicants can carry out a self-assessment and understand exactly where they are in the points system. I am grateful to the noble Lord for pressing the point, but I urge the House to take a more rounded view of the way the points-based system will work.

Constitutional Renewal Bill: Joint Committee

Baroness Ashton of Upholland: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That, notwithstanding the resolution of this House on 6 May, it be an instruction to the Joint Committee on the Draft Constitutional Renewal Bill that it should report on the draft Bill by 22 July 2008.—(Baroness Ashton of Upholland.)
	On Question, Motion agreed to; and a message was sent to the Commons.

Energy Bill

Baroness Royall of Blaisdon: My Lords, on behalf of my noble friend Lord Jones of Birmingham, I beg to move the Motion standing in his name on the Order Paper.
	Moved, That it be an instruction to the Grand Committee to which the Energy Bill has been committed that they consider the Bill in the following order:
	Clauses 1 to 36
	Schedule 1Clauses 37 to 41Schedule 2Clauses 42 to 74Schedule 3Clauses 75 to 96Schedule 4Clause 97Schedule 5Clauses 98 to 102.—(Baroness Royall of Blaisdon.)

On Question, Motion agreed to.

Statute Law (Repeals) Bill [HL]

Read a third time, and passed, and sent to the Commons.

Employment Bill [HL]

Read a third time.
	Clause 18 [Exclusion or expulsion from trade union for membership of political party]:
	[Amendments Nos. 1 and 2 not moved.]

Lord Bach: moved Amendment No. 3:
	Clause 18, page 16, leave out lines 34 to 36 and insert "after subsection (4B) there is inserted—
	"(4C) Conduct which consists in an individual's being or having been a member of a political party is not conduct falling within subsection (4A) if membership of that political party is contrary to—
	(a) a rule of the trade union, or(b) an objective of the trade union.
	(4D) For the purposes of subsection (4C)(b) in the case of conduct consisting in an individual's being a member of a political party, an objective is to be disregarded—
	(a) in relation to an exclusion, if it is not reasonably practicable for the objective to be ascertained by a person working in the same trade, industry or profession as the individual;(b) in relation to an expulsion, if it is not reasonably practicable for the objective to be ascertained by a member of the union.
	(4E) For the purposes of subsection (4C)(b) in the case of conduct consisting in an individual's having been a member of a political party, an objective is to be disregarded—
	(a) in relation to an exclusion, if at the time of the conduct it was not reasonably practicable for the objective to be ascertained by a person working in the same trade, industry or profession as the individual;(b) in relation to an expulsion, if at the time of the conduct it was not reasonably practicable for the objective to be ascertained by a member of the union.
	(4F) Where the exclusion or expulsion of an individual from a trade union is wholly or mainly attributable to conduct which consists of an individual's being or having been a member of a political party but which by virtue of subsection (4C) is not conduct falling within subsection (4A), the exclusion or expulsion is not permitted by virtue of subsection (2)(d) if any one or more of the conditions in subsection (4G) apply.
	(4G) Those conditions are—
	(a) the decision to exclude or expel is taken otherwise than in accordance with the union's rules;(b) the decision to exclude or expel is taken unfairly;(c) the individual would lose his livelihood or suffer other exceptional hardship by reason of not being, or ceasing to be, a member of the union.
	(4H) For the purposes of subsection (4G)(b) a decision to exclude or expel an individual is taken unfairly if (and only if)—
	(a) before the decision is taken the individual is not given—(i) notice of the proposal to exclude or expel him and the reasons for that proposal, and(ii) a fair opportunity to make representations in respect of that proposal, or(b) representations made by the individual in respect of that proposal are not considered fairly.""

Lord Bach: My Lords, on Report I said that the Government planned to bring forward proposals at Third Reading to implement the approach to the ECHR judgment in the ASLEF v the United Kingdom case which was specified in Option B in last year's consultation document. I also said that our proposals would contain texts on the three types of safeguards which, among others, the noble Lord, Lord Lester of Herne Hill, and my noble friend Lord Morris of Handsworth had sought. These proposals are set out in Amendments Nos. 3, 8, 9 and 10. I shall speak also to the amendments tabled by the noble Baroness, Lady Wilcox, and the noble Lord, Lord Henley.
	I shall first speak to Amendments Nos. 3, 8, 9 and 10. The European Court's judgment in the ASLEF case is clear: the issue centres on balancing the conflicting rights under Article 11 of the European Convention on Human Rights on the freedom of assembly and association—that is, between the right of an individual to belong to a trade union and the right of a trade union to determine its membership. The current wording of Clause 18 implements Option A in last year's consultation, which was deregulatory and removed all references to protected conduct from Sections 174 and 176 of the Trade Union and Labour Relations (Consolidation) Act 1992.
	Many Members have expressed concern that Option A tips the balance too far in favour of the trade unions and so, having listened to the arguments over the months, and in a spirit of compromise, we have decided not to pursue Option A. Through consultation with Peers of all parties and on all sides of the House, we have sought to find a wording which secures the correct balance in response to the court's judgment. Amendment No. 3 therefore restores the provisions relating to protected conduct which the current version of Clause 18 repeals.
	The amendment also inserts new subsections (4C) to (4H) into Section 174 of the 1992 Act. Together these new subsections set three conditions which a trade union must meet if it wishes to expel or exclude a person on the grounds of that person's membership of a political party. These three conditions in effect provide three types of safeguard when viewed from the standpoint of the individual concerned. The first safeguard is set out in new subsections (4C), (4D) and (4E). It specifies that the membership or former membership of a political party must be contrary to a rule or objective of the trade union. A union's rules are well known and easily accessible—indeed, there is a statutory duty for a union to supply a copy of its rules to any person whether or not they are a union member—but union objectives are usually different in character. There may be many of them, they may change more frequently over time and they may be found in many different documents, and individuals cannot be expected to be able to access or understand them all. The amendment therefore provides, in new subsections (4D) and (4E), that it must be reasonably practicable for a person to ascertain the objectives in question. New subsection (4D) sets provisions in the case where a person is expelled or excluded for their current party membership. New subsection (4E) sets the corresponding provisions where the person is excluded or expelled for their former membership.
	We recognise that a person's ability to ascertain an objective depends on whether they are a member of the trade union at the relevant time. Obviously, trade union members should be able to know more, so we set different tests in relation to each group. For those who are or were trade union members at the relevant time, the test is whether it is reasonably practicable for a member of the union concerned to ascertain the objective in question. For those who are not or were not trade union members at the relevant time, the corresponding test is whether a person working in the same trade, industry or profession as the expelled or excluded individual could reasonably ascertain the objective.
	Those provisions are deliberately based on the current wording of Section 176(1D) of the 1992 Act. We feel that consistent wording would assist union understanding and help unions comply with the law. However, we have decided to use a different comparator test for non-union members from that which is currently found in subsection (1D). To achieve consistency, the amendment therefore realigns the test in Section 176(1D).
	The second safeguard is that a union's decision to exclude or expel must be taken fairly and in accordance with its own rules. In other words, this condition relates to procedural fairness, a matter that particularly concerns the noble Lord, Lord Campbell of Alloway, as well as other noble Lords. The relevant provisions are set out in subsections (4F), (4G)(a) and (4G)(b). Subsection (4H) specifies what is meant by an unfairly taken decision. These mirror the basic tests of procedural fairness that the courts apply in common law, the significance of which has been stressed in the House on several occasions. We have not set wider or more general tests of fairness in order to attempt to avoid overcomplicating the law and to avoid giving significant scope for mischievous or vexatious litigants to challenge union decisions.
	The third safeguard is found in new subsection (4G)(c). It provides that the decision to expel or exclude on these grounds must not lead to a loss of livelihood or other exceptional hardship because of the resultant loss of union membership or a failure to obtain union membership. "Exceptional hardship" is the term used in the ASLEF judgment and in other ECHR cases. It will mostly occur where a person loses his or her job, but it may conceivably occur in some other limited cases where an individual suffers another substantial detriment. We do not believe that exceptional hardship is a real threat to most workers because other laws in this country outlaw the closed shop, but we cannot say for certain that such substantial hardship will never occur in any circumstances. Hence, this extra safeguard is included.
	Amendments Nos. 9 and 10 flow from Amendments Nos. 3 and 8. They make consequential changes to Clause 21 and the repeals schedule respectively. Clause 18, as it now is, has aroused strong opinions and passions. At the outset we had hoped to simplify the law in this area through deregulation. We strongly advocated that approach in Grand Committee and elsewhere. However, our arguments have clearly not found favour around the House. Recognising the will of the House, we have therefore come forward with this alternative approach in, as I have said, a spirit of compromise. I thank all those who have taken part in these debates at all stages of the Bill for devoting their time to assisting us in identifying the alternative. I am particularly delighted that the noble Lord, Lord Lester, who cannot be with us today, has added his name to the government amendments.
	We have been mindful of the views of the Joint Committee on Human Rights on this issue, and our amendment reflects all three safeguards that it advocated. I cannot claim that our amendments will necessarily simplify the law—we are, after all, adding six new subsections to Section 174—but we have tried to draft the provisions in a way that goes with the grain of union practices and existing law. We have tried to be as precise as we can to avoid creating room for mischievous litigation.
	It should be remembered that the net effect of all these changes is to provide greater autonomy for trade unions provided that they act responsibly. They will enjoy greater freedom than they have now to expel or exclude persons whose political party membership is in opposition to the union's political beliefs. We are therefore convinced that our approach is consistent with the ECHR judgment. I beg to move.

Lord Henley: moved, as an amendment to Amendment No. 3, Amendment No. 4:
	Clause 18, line 2, leave out "or having been"

Lord Henley: My Lords, I shall speak also to Amendments Nos. 5, 6 and 7. I thank the Minister for writing to me on 22 May about Clause 18, on which he has just spoken. Sadly, I received the letter only when I arrived in the Lords this morning, because, for once, the excellent delivery systems of this House did not manage to forward it to my home in the country. I am grateful for the Minister's explanation in that letter of what the Government were up to. I would have responded to him last week and said that I was in effect satisfied with what the Government were proposing. I would then have given him the assurance that, although I wanted still to table these amendments, I did not intend to divide the House on them. I can now give him that assurance.
	As the Minister said, the Government have in a spirit of compromise gone a considerable distance in trying to come up with a deal that might satisfy us, the Liberal Democrat Benches, the noble Lord, Lord Morris and others who have expressed concern about the clause both in Committee and on Report. The Government have tried to find a compromise that is nearer to, as the Minister put it, Option B than to the original Option A which the Government seemed to favour in their consultation process. For that reason, we will accept it, although we would like to have gone a little further, which is why we have put down the amendments. They are similar to those which we tabled on Report. We might even have discussed something similar in Committee.
	The amendments highlight our concern, first, that only membership of registered political parties is considered excludable. There are many political organisations and pressure groups, membership of which should continue to be exempt. Secondly, we strongly object to former membership being held against a trade union member. That smacks of retrospective punishment, even if the resignation from an objectionable political party had been recent. Such a resignation would show that membership of the trade union was more important to the person concerned than membership of the political party. Who would decide whether a member's resignation was fair?
	That was our concern. I appreciate that the Government have gone a considerable distance since we discussed the matter on Report, for which I am grateful. For that reason, I shall certainly not press our amendments. I look forward to the House accepting the Government's amendment. I beg to move.

Lord Campbell of Alloway: My Lords, having withdrawn Amendments Nos. 1 and 2, as ordained by the Public Bill Office, I was advised this morning by that office and others that I may speak to Amendment No. 3 with Amendments Nos. 8 to 10, which are supported, subject to a caveat, so that I am not speaking out of order. The caveat is that the intendment of Amendments Nos. 1 and 2 should be taken into account before these measures are implemented and that before these measures are implemented the reservations of the TUC should be recognised. I have referred to them in the past; this is a short speech and I shall not repeat myself, but they will be spoken about again today by the noble Baroness, Lady Turner of Camden.
	Amendment No. 3 first came to my knowledge on a chance visit on 29 May to tidy up my desk. As I passed the Public Bill Office, I was handed the amendment. I called up the Department of Trade and Industry to inquire where the Minister was, as I wanted to talk to him about an arrangement that we had made. I was informed that he was in Mexico and had been there for quite some time and that I could not speak to him.
	The scenario has changed. Having opposed, with the Government, the Lib Dem amendment to Clause 18 on Report and—because I am not a member of the Liberal Democrat Party—having no knowledge of the negotiations that resulted eventually in Amendment No. 3, this came as a great surprise. Amendments Nos. 1 and 2 had been withdrawn on Report on the assurance, made between myself and the Minister, that there would be further consideration and consultation, not as to the substance but as to the drafting, before Third Reading. Of course, I hoped that the noble Lord, Lord Jones, was a man of great honour and that if you made a deal with him he was the sort of man who would never rat on you. I rang up to ask him this morning if he could come and deal with this matter today, and deal with the arrangement that we made—because the noble Lord, Lord Bach, knows nothing about it. Very few other people know anything about it, although there is a reference to it at col. 1304 of the Official Report of 19 May. But I was told that the noble Lord, Lord Jones, could not come because he is in Azerbaijan. I do not even know where that is, but I am sure that it is a long way away. So there it is—noble Lords will have to take it from me, pending the noble Lord's return to read the report. This morning I informed the Public Bill Office of that arrangement. The only other person who knew about it was my Chief Whip. I informed my Chief Whip. If I make an arrangement I inform my Chief Whip—she knew.
	I said to the civil servant in the department on 29th May that there had been no consultation and no communication with the Minister. The civil servant arranged with two other civil servants to meet me on 30 May in the Royal Gallery. What was said was confidential and cannot be repeated. The Public Bill Office did not know then that there had been this arrangement and had sent the e-mail which ordained withdrawal of these amendments, which today, if they had not been withdrawn, would have been moved as complementary to Amendment No. 3. That is the straight position.
	The scenario turned itself upside down in the Recess. I opened my e-mail. I am not very good with my e-mail. I leave it alone at weekends because I get very bored with it. Yesterday, at about six o'clock, I opened it up and then I knew that I could not move the amendments. There was then no time to draft an amendment or to do anything. I had a word, by chance, with the noble Baroness, Lady Turner. She did not realise until very late—I cannot remember why—that she could not put down an amendment. So one has been rushed towards the barrier. I am criticising no one because criticism is idle. I am just saying that we have been rushed towards the barrier, and here we are.
	The grounds on which I would seek compatibility today if I had those amendments are strictly relevant for the consideration of government. I have tried to put them in a condensed form. First, these provisions as to conduct are ever subservient to the overarching authority of the ordained procedures as reflected in Amendments Nos. 1 and 2, to which there is no reference either in Amendment No. 3 or in Clause 18.
	Secondly, the proper balance on adjudication is not just between, as it is put, the trades unions on one side, the rule book, the objectives, and the interests of those seeking membership or wanting to remain in membership, where notice is given and the other requirements of our tenets of natural justice are observed. That is not exactly the balance that must be struck, which is as stated in Amendments Nos. 1 and 2. No one has challenged that as being wrong at any stage; it is not wrong, it is entirely right. The balance must be struck between the competing convention rights on the facts and circumstances of each case.
	The third issue—there is only one more after this and I will then sit down—is that without Amendments Nos. 1 and 2, or having regard to their intendment, there is no guidance or signpost to the trade union on adjudication or the employment tribunal on appeal. There is no guidance that the implementation of these provisions as to conduct must be in accordance with the mandatory effect of the ordained procedures.
	The last matter affects the amendment of my noble friend Lord Henley, in that the interpretation of domestic law that distorts that balance would not be acceptable to the Strasbourg court. In other words, one must make it plain that the adjudication must be under the overarching authority of the Strasbourg court. This matter arose on Report. Objection was then made to this amendment on grounds totally wide of the intendment as expressed in the ordained procedures. You cannot amend domestic law to suit your own purpose; you must have implementation within the overarching authority. It is to be hoped that the Government heed the caveat and so reduce the risk of further application to the court. The door has been left ajar under these amendments.
	There was no time to put down our amendments. I am not saying that it was the fault of the Government, but it was not our fault. If, as I have said and shall not repeat again, the Government had had regard to this, everything that should be achieved would have been achieved. It is better to leave it that way than divide the House.

Baroness Turner of Camden: My Lords, the noble Lord, Lord Campbell of Alloway, has referred to TUC reservations. There are indeed TUC reservations about the amendment, and I would not like this debate to pass without your Lordships realising what they are.
	I had a letter from the TUC during the recess. The TUC believes that the proposed government amendment is unnecessary, would place unjustified restrictions on trade unions' ability to determine their membership and is likely to act as an invitation to litigation. There are serious reservations with regard to the proposed amendment. First, under proposed new Subsection (4C) it will be for the courts to determine whether membership of a political party is contrary to a rule or objective of a union. This could provide opportunities for the BNP or other similar bodies to grandstand courts and tribunals and to argue that they are not racist or fascist organisations. This issue is particularly likely to arise in the case of unions that oppose racism as part of their rules. The provision could also require unions to list in the rule books the names of any relevant political parties. Given the ease with which far-Right parties can change their names, this is likely to cause major difficulties and to create opportunities for dissidents to argue that membership of a political party is not contrary to the rules of the union.
	Secondly, the new procedural arrangements introduced in the proposed new subsection (4G)(a) and (b) will create a new statutory remedy for individuals for a breach of contract even though an individual can already complain to the certification officer and/or the High Court on the ground of expulsion in breach of the union's rules. It is not clear how such double regulation complies with the Government's better regulation standards.
	Thirdly, there are serious concerns that under proposed new subsection (4G)(c) one of the conditions that must be satisfied before a union can exclude or expel on grounds of party political membership is that the individual would not,
	"lose his livelihood or suffer other exceptional hardship by reason of not being, or ceasing to be, a member of the union".
	In the TUC's view this condition is in no way required by the ruling of the European Court of Human Rights and could represent an unjustified restriction on trade unions' rights to freedom of association enshrined in Article 11 of the European Convention.
	The expression "exceptional hardship" is legally uncertain and furthermore no evidence has been provided of any abuse by trade unions to justify this provision or to establish why trade unions should be thus regulated. In the absence of closed-shop arrangements trade unions have no control over individuals' access to employment. However, the provision would potentially make a union liable for decisions taken by an employer to dismiss an individual—decisions which are beyond any union's control or influence. Furthermore, it ignores the fact that under Sections 146 and 152 of the 1992 Act individuals are already protected from any detriment or dismissal on the grounds of being, or not being, a union member. It will be recalled that I raised this issue in connection with the previous amendment, when I pointed out strongly that the wording might tie the union to being a party to a decision by an employer over which it had no control, and which had a subsequent deleterious effect on the rights of an individual who had been excluded. There is no reason why unions should be put in the position of having to bear that responsibility in connection with an employer's action relative to an individual member, particularly now that they no longer have closed-shop agreements.
	Fourthly, and perhaps most worryingly—this point was made to me by Thompsons, the legal firm which acts for a number of unions—if the amendment had been in place in the Lee case—that is, the ASLEF case—it is likely that Mr Lee could have successfully challenged the exclusion from the union even though subsequently ASLEF went on to win before the European Court. It is difficult to know how the amendment therefore gives proper effect to that court's ruling.
	Those are the TUC's views on the amendment to Clause 18. It is only right and proper that noble Lords should know what they are before they reach a decision. I realise that the amendment has wide support in this House but it seems to me that if it becomes law we may very well find ourselves once again at the Strasbourg Court, and nobody wants that to happen. There is considerable concern within the trade union movement, as expressed by the TUC, that the wording now before the House will not make things easier but rather a great deal worse, a great deal more complicated and a great deal more difficult for unions to comply with in situations such as the ASLEF case. That was not the original intention. The Government introduced the provision in the Bill because they were concerned to put into operation what was apparently required by the original decision in the ASLEF case before the ECHR.
	Therefore, I am not happy about the amendment. It will undoubtedly be endorsed by the House, in which case it will be up to the TUC to take it further by whatever means are available to it, including perhaps lobbying Members in the other House when the matter gets to the Commons.

Lord Morris of Handsworth: My Lords, I have no desire to unduly delay the House, but I wish to make one or two comments as briefly as they can be made. First, I thank the Minister for his contribution and work in seeking to secure broad support for the amendments, particularly Amendment No. 3, and—more than that—to have a change of strategic direction in respect of option B as opposed to option A. Also, I mention the work done by my noble friend Lord Lester. Although he is absent this afternoon, he attached his name to the amendment. The House will recall his contribution to the debate.
	For my part, I think that the amendment has delivered on the three key principles which were a necessary precondition for supporting the Bill. The first was to ensure that Her Majesty's Government met their obligation to the ECHR ruling. My view—it is the view of a lot of others who have read the judgment and followed the debate—is that recognition of compliance has been achieved as a result of the amendment.
	The second principle of great importance was the maintenance and preservation of free, unfettered and democratic trade unions having the ability to govern, police and implement their own rules. I see nothing in the Bill that will undermine that fundamental principle. I know of the TUC's concern, but I equally know of the briefing sent out by one or two solicitors. If one were unkind, one would begin to ask whose interests were served in the pursuance of suggesting that free and democratic trade unions would be undermined as a result of the Bill.
	For me, the most fundamental principle in the debate, which the Bill has preserved, is the right of members of trade unions to natural justice in circumstances of either expulsion or exclusion from their trade union. No one in this House has argued against the principles of natural justice. What we have argued is that the Government's starting point was to seek to provide mere remedies after the event. This amendment places a right and proper duty on the party that will be taking the principal decision to exclude or expel to comply with the principles of natural justice through procedures and ordinary rights of appeal enshrined in union rules. This Bill does not and will not write the union rules. Unions as free democratic organisations will have an opportunity to write those rules themselves. If members feel a sense of grievance about the way in which the rules are applied, they will have an opportunity to seek redress elsewhere.
	Three key principles have been met: Britain will be able to comply with its statutory obligations, trade unions will have freedom and democratic rights in respect of their rule books, while the ability to discipline their members has been preserved, and members' rights to natural justice will be safeguarded. On that basis, I support Amendment No. 3 in the name of my noble friend Lord Jones and I wish the Bill well on its way.

Lord Campbell of Alloway: My Lords, the noble Lord is an experienced trade union leader and I have listened with great attention to everything that he said. Does he agree with what his noble friend Lady Turner of Camden said about the attitude and worries of the TUC?

Lord Morris of Handsworth: My Lords, I assure the noble Lord that the TUC has expressed its concerns not just to my noble friend Lady Turner but to many others. However, I suspect that, when the TUC looks at the amendment and the principles that I expounded, not only will it begin to recognise that Britain's ability to meet its obligations and the preservation of trade unions as free democratic organisations have been safeguarded, but it will, I am sure, be the first to accept that individual members' rights to redress—not just to remedies, but to proper protection—have been ensured. Furthermore, if the Bill, when it reaches the statute book, is applied in the spirit in which it is intended, it can only strengthen the power and authority of the trade union movement. The TUC will be stronger and it will support the Bill.

Lord Borrie: My Lords, I suspect that most Members of this House will agree with many of the principles and details mentioned by my noble friend Lord Morris of Handsworth, not only in answer to the noble Lord, Lord Campbell of Alloway, but in the main part of his speech. There is a great deal of agreement that the Government and the noble Lord, Lord Lester of Herne Hill, who is absent, should be congratulated on the amendment. However, to some extent I share the concern of the noble Lord, Lord Campbell of Alloway, that undertakings made to him only a few days before the Recess by my noble friend Lord Jones of Birmingham, who is also absent, have not been carried forth. An amendment suddenly appeared during the parliamentary Recess. Like the noble Lord, Lord Campbell of Alloway, and no doubt others, we first came across it only today. If this is to be the definitive amendment on this key provision in the Bill, it needs to be right. I am not sure that it is right; in other words, therefore, I agree with a great deal of what was said by my noble friend Lady Turner of Camden.
	I am among those who have received briefing from the well known firm of trade union and employment lawyers, Thompsons, which has huge and lengthy experience. One point that it makes—and I think that my noble friend Lord Bach owes it to my noble friend Lady Turner of Camden to answer this—is that proposed new subsection (4C) seems to require a union to have either a rule or an objective that outlaws membership of "that political party".
	I want to develop the point made by my noble friend Lady Turner. As we are all interested in politics, we know that the extreme right—and in my younger days the extreme left as well—is always breaking up into splinter groups. Perhaps the "far left" now has no particular meaning, but certainly trade unions do not wish to have to put up with membership that includes those of extreme right views. It would no doubt be the simplest thing in the world for the BNP to call itself "BNP 2008" and then, on 1 January, to change the name to "BNP 2009"; it would then be a different political party. It has changed its name in the past from the National Front to the BNP to something else—I cannot remember the various names that it has had. Thompsons pointed out to some of us in its briefing:
	"A requirement that the relevant political party be named in the Rules or objects ... would be an invitation to the far right parties liable to otherwise fall foul of trade union Rules and objects to regularly change their names".
	That is the trouble.
	However, the crunch question is: "Does it matter?". It matters from the point of view of the question with which we are all concerned: will the new Bill and the trade union rules made thereafter be compliant with the European Convention on Human Rights? Here, perhaps I may again quote from the Thompsons briefing, which states that,
	"the additional gloss contained in the redrafted (4C) requiring that a union has either a rule or an objective which outlaws membership of 'that political party' fails to understand the ECHR's decision or properly amend the law in the light of the ECHR decision and will be open to further challenge either in the domestic courts or the ECHR in an appropriate case".
	The Minister must give an answer to that because this amendment is in his name and that of the well known human rights lawyer, the noble Lord, Lord Lester of Herne Hill. I am sorry that the Minister is on his own and that he does not have the assistance of the noble Lord, Lord Lester, this afternoon, but does he really think that the amendment and the Bill that will be sent off to the other place will be compliant with the European Convention on Human Rights?

Lord Hoyle: My Lords, before my noble friend replies, I want to associate myself with the remarks of my two colleagues on this side. I fully support the TUC in this. My noble friend Lord Morris says that solicitors may have a vested interest, but surely the vested interest will be in more litigation, not less. This provision is likely to lead to more litigation and I put on the record the fact that Thompsons is totally opposed to that. In the end, it is not just the narrow membership issue that is at stake, but the freedom of trade unions to operate, to associate and, if necessary, to exclude justifiably from membership. What has been said is quite right. If we leave the issue where it is, a trade union will have to name in its rule book the organisation concerned, which, as has been said, could lead to a far right organisation changing its name and continuing to change its name so that a particular member would never be expelled from the union. That is the truth of it.
	I am afraid that I do not like many things about the amendment. It is far too narrow and I do not believe that it will fulfil the objectives that have been put forward. I think that more litigation will result from it. We hoped that the unions would not have to go to Strasbourg again on this matter but I think that this makes the situation worse. I say to my noble friend that complaints can be made to the certification officer, so why do they have to go back to the court? Is this a matter of bypassing? The certification officer is there to deal with such matters. I am sorry that it has come to this, but we need an explanation from my noble friend Lord Bach. It would have been more straightforward to take the first proposal rather than this amendment. I am sure that the TUC will not rest and that it will be very upset if this is carried through. The only objective open to it is to continue its lobbying in another place. I hope that my noble friend will pay attention to what we are saying.

Lord Razzall: My Lords, with some trepidation, I support the amendment to Clause 18, which stands in the names of the noble Lord, Lord Jones of Birmingham, and my noble friend Lord Lester of Herne Hill. As I said at Second Reading, support for this has been reciprocated on all sides of the House. I am standing in for someone who is regarded as, if not one of the world's experts on human rights, certainly one of the UK's experts on human rights; he is very sorry that he cannot be in his place today. However, as a result of the negotiations that he and others had with the Government, he was delighted to put his name to the amendment. I know that if he were here he would also have liked to have thanked the noble Lord, Lord Morris of Handsworth, who he feels has been instrumental, with him, in producing the amendment before us today.
	Before the Minister speaks, perhaps we should go back a little and remember what the amendment and the debate on this clause are about. I think that I am right in saying that it is common ground that we are under an obligation to implement in our legislation the ECHR decision in Aslef. I say that I think that it is common ground because I know that it is common ground on the other side of the House and it is certainly common ground on the Liberal Democrat Benches but, many weeks ago in the Moses Room, there was a moment when I thought that the Tory Opposition were flirting with the concept that we are under no obligation to legislate, in breach of the various treaties that the British Government have signed and which have been endorsed by every Tory Government of which I am aware. The noble Lord, Lord Henley, might have suggested that, but I do not think that he continued with the argument, so I suspect that we are on common ground on all sides of the House that we are under an obligation to implement or to put into our law the result of the Aslef case.
	The noble Lord, Lord Morris of Handsworth, put it clearly when he said that, in taking the heat out of this, the Government went out to consultation on whether to go to solution A or solution B. The original clause had solution A, which I know that the TUC supported—it did not have to have its tanks on the Government's lawn at that stage. The amendment before us is a form of option B, so we are really talking about a straight choice between option A and option B.
	It will be of no surprise to noble Lords that from these Benches, as articulated until today by my noble friend Lord Lester of Herne Hill, we have always been in favour of option B, for the reasons that the noble Lord, Lord Morris of Handsworth, gave. I ask Members opposite who have had their reservations about this: do they really not accept that proposed new subsection (4G) is not the way that any responsible trade union would conduct itself? Do they really accept that anyone can be expelled if,
	"the decision to exclude or expel is taken otherwise than in accordance with the union rules"?
	Do they really accept that someone can be expelled from a trade union if, under subsection (4G)(b),
	"the decision to exclude or expel is taken unfairly",
	for all the reasons given by the noble Lord, Lord Morris of Handsworth?
	I understand the argument about subsection (4G)(c), which is the exceptional hardship provision, because the TUC position ably articulated by the noble Baroness, Lady Turner, is: why should we include that when we no longer have the closed shop? I know that I speak for my noble friend Lord Lester of Herne Hill and others on these Benches when I say that we cannot necessarily foresee circumstances under which,
	"the individual could lose his livelihood or suffer other exceptional hardship by reason of not being ... a member of the union".
	That is a fail-safe provision, which it is prudent to have in the Bill.
	Two objections came from the noble Baroness, Lady Turner, who reflected the views of the noble Lord, Lord Campbell of Alloway. The first was that in some way, were we to adopt option A and have the original Clause 18, that would magically reduce the opportunity for litigation. I just do not see that. I do not see that if someone had been dismissed in ways not according to the union's rules or if someone had been dismissed because the decision had been taken unfairly, that would mean that that person would put his hands up and say, "That's fine, they went for option A, therefore I can do nothing about it". I have read the briefings from other firms of solicitors. I do not see the argument that somehow going for the original Clause 18 would reduce the opportunity for litigation if the conditions under which the individual had been expelled were listed in paragraphs (a), (b) and (c) of subsection (4G). I do not accept that argument.
	As for the point made by the noble Lord, Lord Borrie, about the definition of a political party in Clause 14, to take the remarks made by the noble Lord, Lord Morris of Handsworth, and speaking as an ex-lawyer, I do not think that it will take Thompsons or other firms long to draft a rule book that gets round the issue of the BNP changing its name. I can see how to do it. If anyone wants me to, I will go outside and spend five minutes drafting it, but I suggest that we leave that to Thompsons. In the mean time, I am happy to support the amendment.

Lord Bach: My Lords, I thank all noble Lords who have taken part in what has been an absolutely fascinating debate on the government amendment. I will of course deal with the amendments spoken to by the noble Lord, Lord Henley, who I thank for his remarks.
	I feel obliged to make one or two comments in response to the speech of the noble Lord, Lord Campbell of Alloway. First, I emphasise how grateful the Government, and particularly my noble friend Lord Jones, have been to the noble Lord, Lord Campbell, for the interest that he has taken in this and his suggestions, but there seem to be some mistakes in memory. As I understand it, the noble Lord, Lord Campbell, saw my officials last Friday. As a result of that meeting, it was suggested to him that he might like to speak to my noble friend Lord Jones over the weekend: that is, between my noble friend coming back from Mexico and going to Azerbaijan—in both cases to try to win exports for this country, let it be said. He had a brief window during the weekend when he was in the UK, and was willing—indeed, wanted—to talk to the noble Lord. However, as I understand it—I was not present—the noble Lord, in his usual generous spirit, commented that he did not want to interrupt my noble friend's brief weekend. That discussion was possible, but it was not taken up.

Lord Campbell of Alloway: My Lords, the noble Lord is quite right; I did not want to inconvenience his noble friend. However, I left my private telephone number at home. The arrangement was that if he felt like calling me up, I would be there.

Lord Bach: My Lords, the very last thing that anyone on the government Front Bench would want to do is to offend the noble Lord in any way in these matters. That was certainly no one's intention. The noble Lord also asked us to have regard to his amendments, although he has not moved them this afternoon. I assure him today that we certainly will.
	My noble friend Lord Borrie suggested that the government amendment was tabled during the recess. Actually, it was not; it was tabled on Thursday 22 May, which is the day on which we went into recess. Noble Lords will remember that Report was on Monday 19 May. We worked very hard, or at least my officials did, to get the amendment into a workable form before the recess. The convention, if not the rule, suggests that Third Reading government amendments should be tabled well in advance, so we tabled it on Thursday 22 May. I wrote a letter to noble Lords with the amendment, and I can only apologise that it did not arrive sooner. I thought that I had made it quite clear that those letters should be got to noble Lords as soon as possible, and I can only regret that they were not. I particularly regret that today is the very first day on which noble Lords have had sight of this significant amendment. The amendment was forecast on Report, but of course looking at the amendment itself is what is important. As I said, it was laid down on 22 May. It could not have been tabled any quicker.
	On the other amendments, I shall try to deal with the points that have been made in what has been an extensive debate. The noble Lord, Lord Henley, moved Amendments Nos. 4 to 6, which seek to prevent trade unions being able to exclude or expel on the basis of former membership of a political party. Our stance has not changed, I am afraid. We think that that would place a further limit on the freedom of trade unions to set and apply their rules, and therefore run contrary to the thrust of the ECHR judgment.
	The noble Lord said on Report that he was opposed to trade unions being able to expel or exclude on this basis, even if an individual had only recently resigned his or her membership. This would provide scope for infiltration of trade unions by those who hold objectives and views which are incompatible with those of the union. It is easy to foresee a situation in which a BNP member resigns his membership on learning of a union's intention to expel him only to rejoin once the threat of expulsion has passed. This cat-and-mouse cycle could continue indefinitely, imposing a significant administrative burden on the union and producing a loophole for vexatious action. This amendment would substantially frustrate the ability of trade unions to expel or exclude on the basis of political party membership and is, we think, contrary to the spirit of the ECHR judgment. It is interesting that the Joint Committee on Human Rights, in its consideration of how best to respond to the judgment, also included expulsion or exclusion on grounds of former membership.
	We understand the argument that individuals change their political beliefs and accept that this can be done genuinely, wholeheartedly and with none of the malicious intent that I have just mentioned in my example. I am equally certain that trade unions accept this, too. Unions are in the business, as has been said, of recruiting members, and they will not seek to deny membership to those who have genuinely changed their views. Indeed, there are a number of well known examples of that happening. We have to remember that unions still need to follow fair procedures when expelling someone on the grounds of their former membership. The government amendment ensures that an individual has a fair opportunity to make representations and that those must be considered fairly by the trade union. This gives ample scope for that person to show that they no longer hold the same political beliefs.
	Amendment No. 7, also in the name of the noble Lord, Lord Henley, is similar to an amendment that was tabled on Report. It seeks to define what type of organisation qualifies as a "political party". We maintain our position at Report. We should be wary of introducing new wording to this legislation which is not strictly necessary. As I pointed out then, no definition of what constitutes a political party has existed in relation to these provisions, which were first introduced in 1993. As far as I am aware there have been no problems at all as a result. No problems were mentioned either in this debate or on the previous occasion.
	The amendment would also create a serious problem. By defining a "political party" as only those that are registered within the UK, the amendment would exempt from this legislation the many members of British trade unions who are foreign nationals. I am delighted to be able to repeat that those numbers are increasing. Some of those individuals will be members of political parties in their own countries. While I am sure that the majority of those parties will have objectives that are entirely compatible with membership of a trade union, it is a fact of life that political extremism is found in all countries. Trade unions must be free to take action against such individuals while adhering to the general safeguards that our amendment provides. That is why the Government cannot support Amendment No. 7.
	Perhaps I may turn to other comments made during this interesting debate. I say to the noble Lord, Lord Campbell of Alloway, that the government amendment to Clause 18 strikes that balance between the competing Article 11 rights that the ECHR was so concerned about. Our amendment makes that clear.
	I am very grateful to my noble friend Lady Turner for her part in these debates. She spoke of breach of contract. There is no new ability for individuals to bring a claim for breach of contract as a result of our amendments. It has always been possible under option A—what Clause 18 looks like at the moment—for an expelled individual to bring a claim for breach of contract if a union breached its own rules in expelling him. However, an excluded individual never had a claim for breach of contract. This amendment provides additional safeguards for excluded individuals, which is absolutely in line with the recommendations of the Joint Committee on Human Rights.
	My noble friends Lady Turner and Lord Borrie asked whether we felt that option B is compatible with the judgment of the European Court. We are confident that it is. As I have just said, the JCHR suggested a similar amendment to the one we have moved today. My noble friend Lady Turner argued that our amendment would make it harder for trade unions to expel or exclude on these grounds, but under current law trade unions cannot simply expel or exclude on the grounds of political party membership. Therefore Clause 18 as amended gives trade unions more freedom than they currently possess.
	My noble friend Lord Hoyle talked about the role of the certification officer and raised the issue of using that officer as a remedy. The certification officer is a useful route for individuals who may have a complaint, but it is not available for exclusions, only for expulsions because the role of the officer is limited. My noble friend also said that he wanted to keep cases out of the courts. In fact the remedy for someone who is excluded would have to be through the employment tribunal.
	Lastly, I turn to the point made by my noble friends Lord Borrie and Lady Turner about unions needing to identify and proscribe political parties in their own rules or objectives. We have thought about this and we do not think that it is necessary. We believe that general rules or objectives about the union's political beliefs or attitudes, stating what it favours or what it dislikes, such as fascism or extreme xenophobic political parties, should suffice. Likewise, non-political rules relating to anti-racism or cultural pluralism may be used to show that membership of an extreme political party is contrary to the union's rules or objectives. Membership need not be of that political party but of any political party whose values contravene the union's rules or objectives.
	We believe that trade unions in this country play a crucial part in protecting the rights of workers and we have put into effect, as we were bound to do, the ASLEF judgment. That judgment gives trade unions greater freedom than now to exclude or expel members whose political party membership is in opposition to the union's political beliefs. So this is a sensible step forward in terms of giving trade unions the extra power which the court said that they should have. There is a genuine disagreement about which of the two options should be adopted, and that disagreement has been debated in this House from day one of the Bill. The Government have come to the view that our amendment is the right way to pursue this.

Lord Henley: Since we are formally debating my Amendment No. 4, which seeks to Amendment No. 3, it falls to me to withdraw my amendment, as I promised to do. In doing so, I thank the Minister for introducing the amendment in the names of those who have been described as "the absent" noble Lord, Lord Jones of Birmingham, and "the absent" noble Lord, Lord Lester of Herne Hill, and for bringing it forward in a spirit of compromise. I am sorry that he has not had what might be called unanimous support from his own side of the House. I thought that the Government needed all the friends they could get at the moment, but on this issue they seem to have lost the noble Baroness, Lady Turner, the noble Lords, Lord Borrie and Lord Hoyle, and, it seems, the entire TUC to boot. But no doubt the noble Lord will be building bridges in due course to try to re-establish links with those three eminent Peers and the Trades Union Congress.

Lord Bach: I do not think that as a Government we have to build any links with my three noble friends. They are great supporters of the Government and we are absolutely delighted that, at least on these Benches, we can discuss these matters freely and openly.

Lord Henley: My Lords, perhaps I may put it in the words of P G Wodehouse: they may not be exactly disgruntled but they seem far from being gruntled. I was making the point that the noble Lord may have to do a little building of bridges. We are grateful for what he gave us and no doubt the Liberals are as well. In that spirit of compromise, I beg leave to withdraw Amendment No. 4.

[Amendment No. 4, as an amendment to Amendment No. 3, by leave, withdrawn.]
	[Amendments Nos. 5 to 7, as amendments to Amendment No. 3, not moved.]
	On Question, Amendment No. 3 agreed to.

Lord Bach: moved Amendment No. 8:
	Clause 18, page 16, leave out lines 38 and 39 and insert "in subsection (1D)(a), for "a member of the general public" substitute "a person working in the same trade, industry or profession as the complainant""
	On Question, amendment agreed to.
	Clause 21 [Commencement]:

Lord Bach: moved Amendment No. 9:
	Clause 21, page 17, line 22, leave out "and Part 6 of the Schedule come" and insert "comes"
	On Question, amendment agreed to.
	The Schedule:

Lord Bach: moved Amendment No. 10:
	The Schedule, page 19, leave out lines 22 to 32
	On Question, amendment agreed to.
	An amendment (privilege) made.

Lord Bach: My Lords, I beg to move that this Bill do now pass.
	Moved accordingly, and, on Question, Bill passed, and sent to the Commons.

Child Maintenance and Other Payments Bill

Baroness Royall of Blaisdon: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Child Maintenance and Other Payments Bill, has consented to place her prerogative and interests so far as they are affected by the Bill at the disposal of Parliament for the purposes of the Bill.

Read a third time.
	Clause 11 [Review of the status of the Commission]:

Lord McKenzie of Luton: moved Amendment No. 1:
	Clause 11, page 5, line 36, after "order" insert "made by statutory instrument"

Lord McKenzie of Luton: My Lords, I shall speak also to the amendments grouped with Amendment No. 1. They are both minor and technical and make clear the implementation process by which we will commence certain provisions.
	Clause 11 provides that the Child Maintenance and Enforcement Commission be established as a non-departmental public body with Crown status. Noble Lords will remember that this status will be reviewed after three years. The amendment clarifies that should the commission cease to be a Crown body following this review, the order will be made by statutory instrument.
	Clause 62 provides commencement dates for certain provisions within the Bill. Subsections (1) and (2) provide specific dates for when a few certain provisions will come into force. Subsection (3) provides that provisions not covered in subsections (1) and (2) shall come into force as and when the Secretary of State makes an order by statutory instrument. Amendment No. 4 inserts a further subsection to clarify that such an order may include transitional provision or savings. This is a standard provision and will streamline the staging of individual provisions being commenced. For example, when Section 6 repeal is commenced, it is necessary to include in the commencement order provision for existing cases to be continued as if they had been private applications. I beg to move.

Lord Skelmersdale: My Lords, we on this side of the House have no objection to these two sensible amendments. However, I would like to pick the Minister up on one tiny point. I understood him to say that when CMEC ceases to exist, then the order will be passed. I am sure he meant to say that when the Government decide that the organisation ceases to exist, then the order will be laid.

Lord McKenzie of Luton: My Lords, perhaps I may explain what I said. The amendment clarifies that should the commission cease to be a Crown body following the review by the Government, the order will be made by statutory instrument. I hope that has clarified the matter.

Lord Skelmersdale: My Lords, the review does not cause the Crown body to cease. What causes it, surely, is the Secretary of State's intention.

Lord McKenzie of Luton: My Lords, that is right, of course, but it follows the consequences and the review.

Lord Kirkwood of Kirkhope: My Lords, I also understand the reason for the two government amendments, but if the review finds that a change is required, will the statutory instrument proposed in this group of amendments be made by the affirmative, as opposed to the negative, procedure? It is not clear to me, as the amendments are worded, which way around it is. I hope the Minister can reassure us that, in the eventuality, it will be done by the affirmative and not the negative procedure.

Lord McKenzie of Luton: My Lords, I am happy to confirm that it will be by an affirmative process. That is right, given the nature of the decision.

On Question, amendment agreed to.
	Clause 35 [Registered maintenance agreements: Scotland]:

Lord Kirkwood of Kirkhope: moved Amendment No. 2:
	Clause 18, page 16, line 30, at end insert—
	"(A1) On expulsion or exclusion from membership of a trade union on grounds of membership of a political party, a proper balance shall be struck on the facts and circumstances of the case as between the entitlement under the European Convention of Human Rights of the trade union of freedom of association and of the individual's entitlement to seek or retain membership of the union; due account having been taken of any consequential adverse effect of employment.
	(A2) Subsection (A1) may be implemented by Order in Council made by the Secretary of State as guidance having legal efficacy subject to affirmation by each House of Parliament."

Lord Kirkwood of Kirkhope: I shall speak also to Amendment No. 3 in my name and the important additional and wider amendment in this group in the name of the noble Lord, Lord Skelmersdale. This issue is carried over from Report. It is an important attempt at the last minute, under the procedures of this House, to take account of what I believe are the special circumstances of Scottish civil procedure.
	Amendments Nos. 2 and 3 are much narrower than Amendment No. 19. They relate to Clause 35, which deals exclusively with registered agreements in Scotland. Minutes of agreement registered in the Books of Council and Session are enforceable ab initio in a way that puts them in a separate category; indeed, law relating to the Child Support Agency has, in many of its facets, been distinct and separate north of the border. Therefore there are circumstances where we should look carefully at Amendment No. 2.
	The amendments would leave minutes of agreement registered in the Books of Council and Session outside the CMEC remit for four years across the jurisdiction of Scotland. That would take a very small number of often complicated cases out of the new commission's hands. If the Government cannot see their way clear to going so far as that, I wish to make a plea. Although Clause 41 provides an opportunity for pilot schemes, they would be restricted to a two-year period, and I do not know that that would give anyone a chance of working out whether the provision was helpful. Still, my suggestion is potentially a pilot scheme type if the Government are not prepared to go for the full four-year period proposed in Amendment No. 2.
	I understand that the Minister was as good as his word and kindly agreed at the last minute to meet some of the specialists from the Law Society of Scotland. Alas, the follow-up meetings have not been able to take place in the recess in advance of Royal Assent being given to the statute, but he could help the House by explaining how those discussions went. The least that he might consider doing, if he does not accept the amendments, is to talk seriously to the commission about the prospects of what might be a pilot or might not, and to continue to explore the possibilities that are available north of the border, having regard to the special civil procedural differences that apply there, to see whether there is some way of accommodating some of the concerns that are at the forefront of the minds of some of the key practitioners in Scotland. I beg to move.

Lord Skelmersdale: My Lords, far be it from me to get involved with the expertise of the noble Lord, Lord Kirkwood, based on his extensive background in legal practice in Scotland on the subject of child maintenance. I therefore wish to degroup my Amendment No. 19 from the Scottish provisions, because it covers an entirely different point and is relevant purely to England and Wales rather than to Scotland.

Lord McKenzie of Luton: My Lords, I thank the noble Lord, Lord Kirkwood, for the amendment, which, as he explained, seeks to extend the current period of 12 months during which parents with minutes of agreement registered in the Books of Council and Session or the sheriff court books may not apply to the commission for a maintenance calculation. The amendment would prevent those parents applying for a period of four years.
	The merits of minutes of agreement as a means of settling child maintenance have been rightly discussed at some length during the passage of the Bill. As the noble Lord indicated, I have also recently discussed the matter in some detail with the Law Society of Scotland. I recognise the value of this uniquely Scottish instrument; indeed, we have amended the Bill at an earlier stage to clarify its role in the child maintenance system north of the border.
	As we discussed in Committee and on Report, the 12-month rule has two main purposes: first, if agreement between parents breaks down, it provides a swift and readily available route into the statutory maintenance system so that children are not left for considerable periods with either no maintenance or inadequate arrangements. Secondly, it encourages the concluding of agreements that contain levels of child maintenance broadly consistent with the amount calculated under the statutory scheme.
	I recognise the very special nature of minutes of agreement and the important differences between the Scottish legal system and that in England and Wales. As I mentioned earlier, I met the Law Society of Scotland to discuss this, and my officials will continue the dialogue.
	However, while we recognise that registered minutes of agreement have many advantages, our view remains that if circumstances change and the original agreement needs adjustment, difficulties may arise, and children may be stranded with inadequate arrangements that no longer work. There are particular problems with varying registered minutes of agreement where, for example, the parents have not been married before separation.
	I make it clear that the commission does not wish to intervene to disturb maintenance arrangements that are working well. Parents must decide whether their children's interests are best served by the provisions of a registered minute of agreement or by a maintenance calculation made by the commission or by some other route. We do not wish to restrict any effective and agreed maintenance arrangements, in whatever form, to a year, four years or any other period. The Government's view remains that the 12-month rule is the right policy to ensure a regular flow of income for the child where the parents have separated. A 12-month period strikes the balance between giving alternatives to statutory maintenance arrangements a chance to bed in and work, and providing a means to resolve difficulties quickly and keep payments flowing.
	That may disappoint the noble Lord. While I cannot offer the prospect of a pilot, I can certainly offer that of continuing engagement with the Law Society of Scotland. On that basis, I hope that the he will feel able to withdraw the amendment.

Lord Kirkwood of Kirkhope: My Lords, I thank the Minister for his reply and for the trouble that he took in considering again this important question. It will continue to be an issue, and I hope that he will keep it under careful review, but on the basis of what he said, I am happy to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 3 not moved.]
	Clause 62 [Commencement]:

Lord McKenzie of Luton: moved Amendment No. 4:
	Clause 62, page 50, line 17, at end insert—
	"( ) An order under subsection (3) may include such transitional provision or savings as the Secretary of State considers necessary or expedient in connection with bringing any provision of this Act into force."
	On Question, amendment agreed to.
	Schedule 4 [Changes to the calculation of maintenance]:

Lord Skelmersdale: moved Amendment No. 5:
	Schedule 4, page 71, line 41, after first "is," insert "has been,"

Lord Skelmersdale: My Lords, this may be thought to be a curious piece of drafting, but it provides a hook on which I can develop an argument. Since Report, I have been made aware of a very disturbing incident which does not appear to be covered by the current wording of paragraph 6 of Schedule 4. The non-resident father of a young child wrote to me to explain that, between September 2006 and June 2007, he had had continuous weekly contact with his child. During that period, there was in place a very amicable private maintenance arrangement whereby he paid his former partner £50 a week. In June 2007, the mother of his child, who was the main carer, was advised by the CSA that such level of contact should entail the non-resident parent paying only £35 a week. She reacted forcibly by limiting the father's contact with his son so that she could continue to receive the £50 a week. The three people involved—the father, the mother and, most importantly, the child—are all losers in this case.

Baroness Hollis of Heigham: My Lords, we need just one more piece of information. Is the parent with care to whom the noble Lord refers on benefit? His opening remarks seemed to suggest that she was not, in which case the arrangements could go undisturbed, but he then referred to the CSA, which suggested that she was. Could he give us a little more information?

Lord Skelmersdale: My Lords, I am only relating the facts as presented to me in the letter. I do not know the answer to the noble Baroness's question. But the point is, surely, that even if the mother—or, indeed, the father—was on benefit, the amicable arrangement could or should have continued.
	As I was saying, the three people involved—the father, the mother and, most importantly, the child—are all losers in this case, all due to the intervention of the CSA. I tabled the amendment to discover whether the reworded schedule or the Bill as a whole would prevent such a case recurring. If I have understood the addition to Schedule 4 correctly, adding the words "has been" would mean that if a shared care arrangement was operating in the best interests of both estranged parents and the child, CMEC would not be able to disturb it. I hope that the Minister will be able to tell me that I am right. I beg to move.

Lord McKenzie of Luton: My Lords, I thank the noble Lord for tabling this amendment, the import of which I understand a little better having heard him speak to it. The amendment would mean that when there had been shared care of 52 or more nights in the preceding 12-month period, the amount of child maintenance would be reduced. This amendment, which would apply to basic or reduced-rate cases, mirrors existing arrangements to the extent that currently, in most cases, the Child Support Agency will look at care arrangements over the previous 52 weeks. However, there is a significant difference between those provisions and this amendment.
	We believe it is right that, at the time of setting maintenance liability for the next year, a reduction should apply only if the parents intend to continue shared care. The effect of this amendment could be to allow such a reduction to apply even though shared care had already ceased by the time the maintenance calculation was made. I do not believe that that is what the noble Lord sought through this amendment, but that would be its import. We believe that substantial shared care should be reflected in maintenance calculations. This is, admittedly, a difficult area, which we have debated in Committee and on Report, but there is no clear consensus on what the shared care rules should be. That is why we have left those rules largely unchanged. The impact of shared care on liabilities has the potential to add to disputes between parents, although we would hope that they would always put the benefits to the child before any financial consideration.
	Shared care can also have administrative complexities. The amendments to the Bill are designed to assist with this. For example, paragraph 6 of Schedule 4, to which this amendment is addressed, would allow the commission to base a shared-care reduction on any future agreement between the parents to share care, such as under a contact order. This would be broader than the current arrangement, whereby the Child Support Agency can reach a decision based only on past evidence of shared care, which can sometimes be of poor quality or disputed.
	I think that the thrust of the point that the noble Lord made was that the existence of a change in the maintenance level occasioned by a formula for shared care can, in some circumstances, discourage contact. One would accept that there might well be circumstances in which that could arise but, equally, there could be circumstances in which the lack of any financial adjustments made it difficult for the non-resident parent to participate in contact arrangements and shared care. The Bill fundamentally encourages voluntary arrangements where appropriate. It is for parents to determine the level of child maintenance, but negotiated in the shadow of what the commission would provide and the consequences of any shared care arrangement.
	My noble friend raised the point that if the parent with care is on benefit that would drive the commission's formula. That of course would eventually fall away because being on benefit would not require the use of the commission in the future. I do not believe, and I do not think that we have evidence to suggest, that the shared care formula in any significant way negates contact of both parents. Certainly that is something that we would discourage. We have always made it clear that we want to uncouple fundamentally payment of maintenance for children from contact, while recognising that shared care arrangements have cost implications for the non-resident parent.
	The current formula for shared care, which we broadly propose to carry forward because of lack of consensus, as I have said, will continue. That obviously would not apply if people move into voluntary arrangements. At the end of the day we want sustainable arrangements with which we hope both parents are happy. We believe that is best to make sure that maintenance continues to flow for the benefit of children, and, indeed, that is the best environment for young children to be able to have contact with both parents.

Lord Skelmersdale: My Lords, of course that is what we all hope for. I was rather slow on the uptake in answer to the interruption of the noble Baroness, Lady Hollis, about whether the mother was on benefit. The Bill changes that situation. I am interested in the future rather than the past. I said at the end of my opening remarks that I hoped that such a situation will not recur through the actions of the CSA.
	So far as concerns the Minister, I regret that we do not have 30 readings of a Bill rather than three. Over time he has moved his position, I note, just slightly on all this. He has now admitted—I am sure that I correctly took down his words—that shared care arrangements "could" discourage contact. Clearly, I cannot push him any further than he is prepared to go, but—

Lord McKenzie of Luton: My Lords, of course one would be foolish not to recognise that there may well be circumstances in extremis where the financial adjustment that shared care would produce could discourage shared care, but we do not believe that that is the generality. As I said, I believe that there is an opposite effect, where some recognition of the costs involved in shared care will be reflected in the commission's formula. I was simply in a sense stating the obvious that there could certainly be extreme cases where contact is affected by these adjustments. Essentially it depends on arrangements under which contact is settled. Obviously, if it is settled by the court that is one thing and if it is settled by voluntary arrangements that is something else.
	I come back to the point. We believe that a central point of the Bill is to encourage voluntary arrangements where appropriate. We believe that that is the environment where shared care can best flourish.

Lord Skelmersdale: My Lords, stating the obvious yes, but this is the first time it has been stated during the proceedings on the Bill. I have been pushing away on all this for a considerable number of months now, aided and abetted sometimes by the noble Lord, Lord Kirkwood. It is quite clear that this subject will not go away over the next few years. On that basis, knowing that some thought is going on in the department on this subject, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Schedule 5 [Maintenance calculations: transfer of cases to new rules]:

Lord Skelmersdale: moved Amendment No. 6:
	Schedule 5, page 73, line 8, leave out "The Secretary of State may" and insert "Within one year of the commencement of this Act, the Secretary of State shall"

Lord Skelmersdale: My Lords, we now come to the lamentable subject of transfers: moving people from one scheme to another. It is quite simply a disgrace that thousands of parents with care are still receiving money from the original 1991 scheme, even though that was changed by the 2000 Act. New applicants were of course put on to that second scheme and, under the Bill, new applicants will, again, be put on to this third scheme as set out in Schedule 4. In Committee, I made the point that there will therefore be parents with care receiving maintenance money from non-resident parents from one or other of these schemes. In other words, CMEC will be running all three schemes concurrently. That is bad from the points of view of both the commission and the parents themselves.
	Although the Minister told us in Committee that transfers to the second scheme are now ongoing, it has been a ridiculously slow process. I therefore tabled the amendment to remove the Secretary of State's discretion as to when he moves people from one scheme to another. For reasons we all know, not least the computer fiasco, he has been extremely lethargic in this respect. Today, however, there is no excuse for such lethargy. It should be entirely possible for the Secretary of State to lay the order to move parents from the two old schemes to the current one within one year rather than, as now, to do it at his—or, rather, CMEC's—convenience. I would at least expect the Minister to give us the timetable that the Government intend to follow, so that parents can at last get some clarity as to what to expect and when. I beg to move.

Lord McKenzie of Luton: My Lords, I welcome the noble Lord's amendment and his interest in the movement of cases to the new arrangements. It is an important subject which we have discussed before. We know from experience that this will be one of the most significant challenges for the commission. In the light of this, any decisions regarding the process should be carefully considered.
	The amendment would require the Secretary of State to make regulations in relation to the transfer of cases within one year of the Act coming into force. I acknowledge the intent behind this, but primary legislation is not the right place to make such provision. Perhaps it would be helpful if I outlined some of the relevant factors that are likely to have a bearing on the commission's recommendations to Ministers on the detail and timing of the transfer arrangements.
	Over the next few months, the commission's board will be effecting a number of changes that will allow it to formulate its approach. By the end of this year we will have repealed Section 6 of the Child Support Act 1991; the information and support service will be dealing with customers and their inquiries across the country; and the disregard will have been doubled to £20 a week and will have been extended to all cases in the statutory scheme. The commission will therefore need to study all of this closely and evaluate the effect on its customers, including the effect of its own communications strategy and that of Jobcentre Plus. All of this will inform its decision-making process for formulating recommendations for the next stages in implementing our reforms.
	Furthermore, we anticipate that the commission will consult stakeholder groups in developing processes for the movement of cases and will ensure that parents are supported by a comprehensive communication strategy in order for them to make the decision that is best for them. It would follow automatically—and if it does not, I am happy to make a commitment that it will—that consultation with stakeholder groups would obviously involve engagement with the Opposition Benches as this thinking unfolds. Your Lordships will be aware that it was agreed on Report that considerations for the movement will be subject to affirmative regulations in the first instance, where the proper ministerial and parliamentary scrutiny can take place.
	A lesson from the previous reforms of the child maintenance system is that this preparation is absolutely essential if we are to succeed. I do not believe it to be in the best interest of parents, children and taxpayers to limit the drawing up of this process to a period defined in advance by statute. I hope that, on that basis, the noble Lord will withdraw his amendment.
	The noble Lord referred to transfers between the current system and the new system. I stress that there is no wholesale transfer. We have always maintained that we will not make transfers to the current system—not the new system—until the systems are properly in place to effect that. Of course, there are transfers in some cases, for example where there are new children or new relationships, but there is no wholesale transfer.
	I reiterate that the transition process—the transfer—was considered in the White Paper, is due to start in 2010-11 and will be introduced over a three-year period. That is still the timeframe which is envisaged but it is for the commission to work up the detail of that process.

Lord Kirkwood of Kirkhope: My Lords, I support the amendment. It is important that the House sets standards by which the commission should consider introducing the transition. A point that has continued to concern the Opposition during the Bill's passage is the way in which the computer software and hardware seem to be always slipping inexorably further into the future. We are constantly told that these software upgrades are fundamental to producing the business information, productivity and savings around the whole operational improvement plan, which itself will not mature until March next year. The noble Lord, Lord Skelmersdale, is right to say that all this introduces uncertainty about the situation, even if it were not for the Child Support Agency's history with regard to software and hardware issues.
	I am very sceptical about whether the software programmes are up to speed but the commission has no alternative but to stick with the programme provided by EDS. I am not at all confident that all these problems will be solved by 2010-13 with regard to the specifications established 10 years ago when this programme was put in place. Even at this late stage in the Bill—although this has been discussed previously—the noble Lord, Lord Skelmersdale, is absolutely right to seek assurances on this point. Before it hands over responsibility for these issues the department should establish in its framework agreement with the commission an outline timetable in ministerial minds about what is reasonable; otherwise, the whole thing could slip. We have seen the hopes and expectations of clients who depend on these systems dashed. Therefore, it is incumbent on us all in this third iteration of this legislation to get an outline timetable that instils confidence that it will deliver the goods this time round.

Lord McKenzie of Luton: My Lords, I understand what the noble Lord is saying and recognise his ongoing concerns about the IT systems. I agree that it is important that those systems are right. The commission will inevitably inherit the current systems as improved by PR1. The fact that we resist being specific on the process and detail of the transition within a year of the passing of this Act does not mean that there will be an absence of reporting in the interim. The noble Lord will be aware that Clause 9 requires an annual report to be made by the commission to the Secretary of State. There will be a lot of detail in that. As the noble Lord recognises, the framework agreement which will govern the NDPB will contain targets and the need to report progress in all these areas, so there will not be a vacuum in which the commission will be left to its own devices without a reporting process. However, we resist reporting on the specifics of this process within a year because it is complicated and it is hugely important that we get it right.

Lord Skelmersdale: Well, my Lords, I suppose that I got something out of the Minister's reply, but I am extremely grateful to the noble Lord, Lord Kirkwood, for supporting me on this. The something that I got was that Ministers had not thought beyond the White Paper, which is more than a little surprising given that it is 18 months old.

Lord McKenzie of Luton: My Lords, I cannot allow that to stand. I referred to the White Paper which set down the three-year timetable. Of course a lot of detailed thinking and planning has run on from that and continues on a daily basis, but that does not mean that we want to adhere to the one-year recommendation that the noble Lord is pressing.

Lord Skelmersdale: My Lords, I am not pressing a one-year recommendation. I explained in my opening remarks exactly the reason for my tabling the amendment—that I wanted a timetable. The Minister has reaffirmed the timetable in the White Paper. He also said that in the first few months CMEC would get its act together and start to get cracking, that Section 6 would disappear by the end of the year and that consultation with stakeholders would happen—I assume that he meant during the year, but perhaps not—on moving from one scheme to the current scheme. Is that right?

Lord McKenzie of Luton: Yes, my Lords. Stakeholders will be engaged on a range of matters, of which transition will certainly be one, as will the communications strategy that needs to go alongside that process. That will not necessarily be completed this year but will be ongoing, as it has been in the construction of the White Paper, the legislation and everything that has flowed from it.

Lord Skelmersdale: My Lords, the guts of the answer that the Minister has given to estranged parents with children with whom CMEC becomes involved is that it may well not be until 2013 or 2014 that nobody will be on either of the two old schemes. That will disappoint an enormous number of parents in that most unfortunate position. Regretfully, I cannot pursue the point. I am well aware that my one-year timeframe was totally unachievable, but it served a purpose—to extract this dismal information from the Minister. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Schedule 6 [Use of information]:

Lord Skelmersdale: moved Amendment No. 7:
	Schedule 6, page 74, line 39, leave out "paragraph" and insert "Schedule"

Lord Skelmersdale: My Lords, I shall also speak to Amendments Nos. 8 to 18. I drafted this raft of amendments because, on my reconsideration of Schedule 6, I found it more than a little confusing. As the part of the Bill that defines the powers of the new body—CMEC—to use information, it is important that there be clarity. By substituting every reference to "paragraph" with the words on the Marshalled List—I changed them at the last minute to "Schedule"—I seek to ensure that the work of CMEC is tied into a relationship with the work of HMRC. Without that relationship, the whole operation falls apart.
	I drafted the amendments in response to information recently received from a Question asked by my honourable friend Andrew Selous in another place. He inquired,
	"what access HM Revenue and Customs staff seconded to the Child Support Agency have to HM Revenue and Customs data systems while on secondment".—[Official Report, Commons, 16/5/08; cols. 1849W-50W.]
	The answer was disappointing—it was "none".
	If information is not provided regularly and promptly by HMRC, the whole child support scheme is blown out of the water. One of the old CSA's problems that must not be repeated was the time that it took to sort out cases. A way to prevent delays in calculating child maintenance would be, of course, through data sharing. As the Treasury already has the information regarding the non-resident parent's income, is it not a waste of time and valuable resources for CMEC, or whatever child maintenance agency it happens to be, to duplicate this work by arduously investigating the non-resident parent? Sharing of information between the two bodies would have another fortuitous effect of preventing any parent from purposely concealing income to engender low maintenance payments, because CMEC could check its figures against those held by the Treasury.
	It is important, as I hope noble Lords will agree, that the Minister should give assurances that, should there be difficulty in the provision of information, this joined-up government, as is so often claimed, will not be as dysfunctional as I suspect that it is at the moment. We already know that it is not unusual for employees of HMRC to be seconded to the CSA or any of the regional enforcement teams. I assume that this is done for one of two purposes. The first is to advise on the working of the formula in Schedule 4 and the second is to correlate the actual earnings of the non-resident parent shown by their PAYE returns, with their earnings as stated to CMEC. But thanks to my honourable friend's Question, we know that that is verboten to those seconded HMRC employees, although it would have been of real use to the commission. Why are they seconded if they cannot have access to their former colleagues in HMRC and to the tax files that they previously handled on a daily basis? This can only exacerbate the problems of the very slow speed with which the CSA has operated until now, which is one of the main reasons why it has developed such a bad name.
	These secondees can scarcely be expected to have much, if any, knowledge of the intricacies of child maintenance. I cannot accept the Minister's anticipated response that they do not have to. Will they really have no direct contact with parents? That is difficult to believe. In the real world when a parent telephones with a query or complaint, will not the operator say, "Hold on a minute, I'll transfer you to the person dealing with your case"? We know that the parent's emotions can run high at this point. What training is given to the secondees? They will certainly need it in the scenario that I have described. All members of staff at CMEC need to be properly qualified to deal with the specifics of child maintenance.
	To sum up, the purpose of the amendment is to ask, given the department's Answer to my honourable friend: what use is the secondment of Her Majesty's Revenue and Customs staff to CMEC? I beg to move.

Lord McKenzie of Luton: My Lords, I was rather bemused by the amendment and I confess to remaining somewhat in that state. As set down, the amendments in this group would replace nearly all references to "paragraph" within Schedule 6 with "Schedule". Each paragraph within Schedule 6 enables information held by the specific government department to be supplied to the commission for the purpose of functions relating to child support and enables the commission to supply information that it holds in relation to child support to be supplied to those government departments for the purpose of their specified functions. That is the purpose of the gateway. Changing the references from "paragraph" to "Schedule" takes away the limitations and makes all types of data referred to in the schedule available to all the parties mentioned within the schedule. That cannot possibly be right.
	The importance of data security has previously been raised and it is crucial that the legislation for the sharing of data is watertight and not open to misinterpretation. We believe that the amendments would reduce the clarity of the schedule and would compromise the provisions in place for data security. I take this opportunity to assure noble Lords that the security of data continues to be of paramount importance. We will ensure that security through a number of methods. Safeguards will be built in to ensure that inappropriate or excessive access to information is not available to commission staff and that data access is controlled. Any person found inappropriately to disclose information obtained by working for or on behalf of the commission will be committing a criminal offence. That will enforce data security, which will be achieved through the extension of Section 50 of the Child Support Act 1991.
	It is absolutely fundamental to the new system that HMRC data are used. Basing the assessment on gross income data as provided by HMRC is one of the key planks of the reform because it will enable assessments to be made without reference, in most cases, to non-resident parents. That is part of the process that has caused the CSA to fail in large measure in the past. The purpose of the gateways is to enable that information to be provided.
	I am not aware of the response that the noble Lord's colleague received. However, he asked me about secondees from HMRC to what is currently the CSA but in future will presumably be the commission. I am not familiar with the individual work plans of each office or the career plans for each individual but I can well see that having HMRC individuals available to the commission as part of the operation could be helpful. That would certainly be the case in the minority, and possibly 10 per cent, of cases where HMRC gross data will not be available—for example, in relation to the self-employed—and where having people with HMRC experience could be quite useful. I do not know whether that is how they are being deployed; perhaps I had better look more specifically at the information that the noble Lord has requested, which I do not have available at the moment. However, the fundamental point is that the gateways should be controlled to ensure that the commission gets the information that it needs. The HMRC link is critical to ensuring that future assessments are timely and accurate.
	I hope that that has satisfied the noble Lord—at least, in part. I cannot readily tell him what each individual secondee from HMRC or anywhere else might be doing but I shall see whether I can find out and will write to him if that is of help.

Lord Skelmersdale: My Lords, I am extremely grateful to the Minister. Of course, I did not in any way want these amendments to give licence to what the Minister called inappropriate access to information and its disclosure. Again, I was using this schedule as something of a hook on which to hang the situation that I described in moving the amendment.
	I still believe that the use of secondees from HMRC could speed up the process quite dramatically as long as they were allowed access, first, to their former colleagues and, secondly but arguably not quite so importantly, to the files that they were working on when appropriate to the case with which they are dealing together with the CSA or CMEC. The parliamentary Answer given suggests that neither of those two things will happen if there is no contact. As I said, the Answer to the Question was "none".

Lord McKenzie of Luton: My Lords, perhaps the noble Lord will allow me to intervene, as this is an important point. It is important that data channelled from one department to another for use in, in this case, child maintenance calculations is done through a formal, controlled process to ensure that the data are secure. I am not sure whether this was intended but I would be nervous if an individual seconded to the commission had a relationship with someone at HMRC and they could chat about a particular case on which they might have worked in the past. That would be a dangerous situation and, as I said, I am not sure whether it is what the noble Lord intended. We need to ensure that the gateways are secure and specific. I would need to check whether an HMRC secondee working in an appropriate area of the commission would be unable to access the data that came through that gateway. However, it has to be done on a formal basis; otherwise, we shall be in deep trouble.

Lord Skelmersdale: My Lords, I am all for it being done on a formal basis but, as I said, the Answer received by my honourable friend gave the impression—perhaps it was not intended—that there was no contact at all. In other words, the secondee could not request the information and had to go through someone else in CMEC or the CSA. That cannot be the right way of proceeding. I may have read more into the Answer than was intended, but it occurred to me that it would not be unreasonable to raise the point with the Minister so that he could look at whether the activity that I have described and am fearful of is going on. He very kindly nods, so I assume that he will investigate that. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 8 to 18 not moved.]
	Schedule 7 [Minor and consequential amendments]:

Lord Skelmersdale: moved Amendment No. 19:
	Schedule 7, page 76, line 18, at end insert—
	"(1A) In section 4(10)(aa) (child support maintenance), for "one year" substitute "three years"."

Lord Skelmersdale: My Lords, I make no apology for having ungrouped this amendment from the amendments in the name of the noble Lord, Lord Kirkwood of Kirkhope—Amendments Nos. 2 and 3—or for raising the same issue as, in various formats, I have attacked at Second Reading, in Grand Committee and on Report. My devotion to the issue shows how important I think it. I believe that the Minister is perhaps misguided not to share my belief. On Report, he said that he wished to make it clear,
	"that the commission does not wish to intervene or disturb court orders that are working well. It is parents themselves who must decide whether or not their children's interests are best served by the provision of a consent order, or by a maintenance calculation made by the commission".—[Official Report, 13/5/08; col. 980.]
	In 2006, there were 148,141 divorces in the United Kingdom and many of those separated partners will have children, so the 12-month rule potentially affects many people. Up to now, the Minister has persistently missed the point. He said when I moved a similar amendment on Report:
	"We have always been clear about not linking contact with maintenance".—[Official Report, 13/5/08; col. 954.]
	So has the whole of officialdom: the Government, the Official Opposition and the courts all agree with that. I venture to suggest that the noble Lord, Lord Kirkwood—who will have the opportunity to correct me in a moment if I am maligning him—would also agree. The point that officialdom is missing is that parents with care do not agree. Also the Bill has an inbuilt encouragement to tie maintenance in with access.
	It is too late in the parliamentary process to rewrite the Bill but I make one last-ditch attempt to get the Minister to change his mind and not to brush this pertinent correlation under the carpet as he has done before. In the interrogative mode in which I have moved all my amendments this afternoon, I use this amendment to ask the Minister whether he can produce any figures to show how many court cases have subsequently resulted in changes made by the CSA. If the CSA cannot produce such figures—I think that he said on Report or in Committee that it does not collect them—surely the Courts Service should be able to, as presumably a court settlement has to be broken once the CSA and, in the future, CMEC become involved. I beg to move.

Lord McKenzie of Luton: My Lords, I thank the noble Lord, Lord Skelmersdale, for moving the amendment, which seeks to extend the current period of 12 months during which parents with a court consent order for child maintenance may not apply to the commission for a maintenance calculation. The amendment would prevent such parents applying for a period of three years. As he indicated, we debated this issue in Committee and on Report.
	I reiterate the Government's view on this matter. The purpose of the 12-month rule is twofold. First, when an agreement between parents breaks down, it provides a swift and readily available route into the statutory system so that children are not left for considerable periods with either no maintenance or inadequate arrangements. Secondly, it encourages agreements that contain levels of child maintenance broadly consistent with the amount calculated under the statutory scheme and encourages parents to consider appropriate ongoing maintenance for their children at the time that they divide up their property and assets. We do not want to restrict effective and agreed maintenance agreements to a year, three years or any other period, as I said earlier in response to the amendment tabled by the noble Lord, Lord Kirkwood.
	Our hope is that parents with effective court orders will not need to turn to the commission for a calculation. Parents themselves must decide whether their children's interests are best served by the provisions of a consent order, by a maintenance calculation made by the commission or by some other route. On principle, we believe that options should remain open to parents, including the option of entering the statutory scheme if it is right for them.
	On time periods, we consider that the 12-month period strikes the right balance between giving court orders a chance to bed in and providing a means to resolve difficulties quickly and keep payments flowing. A period of three years is too long to wait for a chance to access the statutory scheme. Parents and children should not be left for considerable periods locked into the court system, when maintenance may not be paid or maintenance arrangements for children may no longer be adequate or working. Parents should be able to resolve the issues, gain access to the statutory scheme, and get payments flowing quickly.
	The noble Lord mentioned that there are 141,000 divorces each year. He will be aware that about 20,000 consent orders are entered into annually. He asserted that parents with care do not agree with our assessment. I am unclear about the evidence base for that assertion; I would like to hear it if he can demonstrate that. He asked for figures on the number of court cases where changes have been made by the CSA—I think that that was his question. If that is the matter on which we have already written to him, the response said that we do not have that information available. I am more than happy to go away to look at that again, but that does not change the Government's fundamental view. We believe that access by the parent to the statutory scheme should be available, because that is the best safeguard for children.

Baroness Hollis of Heigham: My Lords—before my noble friend sits down—his position is absolutely right, but can he confirm what I understand to be the case, which is that under the proposed new system, the old arrangement would still apply? That is that if a parent, presumably normally a parent with care, seeks to go from a court order to the CSA, perhaps because of interrupted payments, she none the less has to give the non-resident parent a two-month notice period—a period of grace, so to speak—so that if there have been any misunderstandings, changes of address and so on that can be reconciled between them, there is that space to permit a reconciliation of information, and so that the court order can continue if that, on reflection, is what the non-resident parent is willing to agree to and respect.

Lord McKenzie of Luton: My Lords, I cannot specifically confirm that; the precise arrangements will be in part up to the commission, but it seems to me that arrangements such as that are entirely appropriate and help to get misunderstandings out of the way and differentiate them from situations that underline a parent's need to use the statutory agency.

Lord Skelmersdale: My Lords, the Minister said that the 12-month rule provides a balance between bedding down and the interests of the child and the parent with care. So would two or even three years, so I am not convinced by that argument.
	The Minister asked for evidence that parents with care do not agree. That is the position of several of the organisations—the stakeholders, as the Minister describes them—that have written to me over the course of the Bill. He would not call that evidence in the academic sense, and perhaps I would not either. None the less, it is my duty to promote the views of people unless I profoundly disagree with them, which indeed I have done.
	I know that the CSA does not collect the figures that I am asking for, but that does not mean that they do not exist. Therefore, I am grateful to the Minister for saying that he will use his best efforts to ask the relevant departments for the figures—I suspect, as I said earlier, that the Courts Service would have them—that should prove my argument one way or the other. Again, I am sure that we will have the opportunity to refer to this over the next few years and not only because of the many orders that are to be laid under the Bill and which, in their first appearance, will be debated by affirmative instrument—a point that the Minister made right at the beginning of our proceedings this afternoon.
	Talking of our proceedings this afternoon, may I, on behalf of these Benches, thank the Minister very much indeed for the way in which he has handled this Bill and for his good temper, even though I have occasionally provoked him perhaps beyond the call of his duty? I think that the Bill on the whole will work, but between now and 2013-14 we shall watch like a lynx to see that it does. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord McKenzie of Luton: My Lords, I beg to move that this Bill do now pass. In doing so, I thank the noble Lord, Lord Skelmersdale, for his kind comments and reciprocate by thanking all noble Lords on the opposition Benches, my own Benches and the Cross Benches for the constructive way in which the Bill has been debated and noble Lords' good-natured determination to ensure that it provides the best possible solutions to two hugely important issues.
	I also take the opportunity to thank the many individuals and organisations that have been so important to the development and passage of the Bill. I also give a big thank-you to the Bill Team, which has supported me effectively through the Bill's passage, for its patient explanations and thoroughly professional approach to the legislation. I believe that it has also engaged constructively with those on the opposition Benches. I look forward to Royal Assent so that we can get on with implementing the important reforms that the Bill makes to the way in which child maintenance is administered. It will lift more children out of poverty, and will ensure that more children receive the maintenance due to them and that more parents fulfil their obligations.
	The introduction of a new scheme to pay a lump sum to sufferers from mesothelioma, which we have not debated much, will provide financial support to anyone diagnosed with this terrible disease. For the first time, people who were not exposed through work will be able to qualify for a payment. I thank again all noble Lords who have contributed to the Bill's progress through your Lordships' House.
	Moved accordingly, and, on Question, Bill passed, and returned to the Commons with amendments.

Sale of Students Loans Bill

Report received.
	Clause 1 [Sale of student loans]:

Baroness Morgan of Drefelin: moved Amendment No. 1:
	Clause 1, page 2, line 11, at end insert—
	"(6A) The Secretary of State shall take reasonable steps to notify the borrower within three months of transfer arrangements taking effect."

Baroness Morgan of Drefelin: My Lords, in Grand Committee, I undertook to consider the notification of sales to borrowers in response to an amendment tabled by the noble Baroness, Lady Sharp. As I stated at the time, it has always been our clear intention to let borrowers know when their loans are sold. Having reflected on the argument that it would be better to strengthen that intention into an obligation, we propose Amendment No. 1. The Secretary of State would have to take reasonable steps to let all affected borrowers know that their loans have been sold within three months of the transaction. We also want to make sure that this obligation applies to any onward sales. As noble Lords may recall from previous stages, the Government think it unlikely that the legal title of the loans will be sold on after the initial sale we expect to make to the special purpose vehicle. But, if that were to happen, Amendment No. 4, which is consequential on Amendment No. 1, would ensure that the initial loan purchaser would have to take reasonable steps to let borrowers know that their loan had been sold on. I am grateful to the noble Baroness, Lady Sharp, for her helpful prompting. I beg to move.

Baroness Sharp of Guildford: My Lords, I thank the Minister for bringing forward this amendment. It is a small amendment, but we were worried that students, on hearing that their loans had been sold on to some anonymous special purpose vehicle—perhaps called Granite or something like that—would worry that the terms of their loan might change. The assurance that the Secretary of State will write to inform them of precisely what has happened to the loan in terms of selling on and to give them assurance that the terms on which the loans were granted will not be changed is extremely important.

Baroness Verma: My Lords, we on these Benches also welcome the concession from the Minister. We understand that it might have been the intention of the Government to inform students all along; yet, as happens all too often these days, much of what should be plain in the Bill is omitted and is left to ministerial commands and secondary legislation. Thus, it is welcome to hear the Minister bravely bucking this trend and putting a requirement to notify students in the Bill.

On Question, amendment agreed to.

Baroness Verma: moved Amendment No. 2:
	Clause 1, page 2, line 13, at end insert—
	"(8) In advance of entering into transfer arrangements, the Secretary of State shall—
	(a) examine the prevailing market conditions and ensure that a competitive market for the loans has been generated;(b) provide the market with full information about the loan book in order that the assets can be efficiently valued;(c) ensure that there has been a genuine transfer of risk from the public accounts to the private sector;(d) assess the proceeds that look likely to be achieved in the transaction using full and clear market information and a comparison with keeping the loans on the Government books, in terms of both likely income flows and levels of risk;(e) make a written statement to Parliament on expenditure incurred in connection with each transfer arrangement."

Baroness Verma: My Lords, that value for money is essential is a point on which there is agreement from all sides of the House. We do not want to be in a situation where the taxpayer or successive Governments are cheated out of money because of a rushed job now. We still feel that there is not an adequate value-for-money framework and hope that we can work together to resolve this significant problem. We are worried that the Bill will create a fire sale. We understand that it is an enabling Bill to ensure that sales can take place, but it is important for the House to know whether plans are already under way to offload a significant portion of them in the near future. Is the rhetoric about providing a framework for future sales just wool being pulled over our eyes?
	I am curious to know whether the Treasury has been in contact with the Minister and whether it has made any overtures about the necessity of timing in the Bill. In Grand Committee, the Minister mentioned that there were forecasts of revenue from the sales in the Comprehensive Spending Review. We were told that the first part of the loan book was expected to fetch £3.4 billion, yet that was in 2007. Since then, the credit market has changed dramatically. The Government have had to nationalise a major bank. It seems much less likely that they would get a similar price now. I understand that the Minister was clear that these were forecasts and not commitments. However, if a similar-sized chunk of the loan book was expected to draw a much lower price, would the sale go ahead?
	We on this side of the House are extremely worried that the Government are trying to make some quick cash and that the sale will go ahead in the near future. We are concerned that the concept of value for money will be spun to become value for money in the current market. That would be unacceptable and is something we must guard against. The student loan book is an enormous financial asset that should be maximised, so we need the most transparent and crystalline assurances that all possible effort will be made and every conceivable model used to deliver value for money to the taxpayer.
	A big question arises over waiting. Why not? I hope that the Minister will be able to answer this, but I suspect that it will be difficult for her. She maintains, of course, that the Bill is not connected to any particular intention to initiate an imminent sale, although a sale has already been budgeted for in this year's CSR. Does the Minister truly, honestly and openly believe, amid the flurry of problems in the financial industry, some of which are unprecedented, that we will get the best possible deal for the taxpayer if the sale goes ahead at any time soon? Let us be honest: this Bill is being rushed through. The drafting has been subjected to constant last-minute improvements and there has obviously not been enough pre-legislative scrutiny. What is motivating this hurry? We suspect that it is the Government's desperation to fill the holes in their budget. It is difficult to believe that the sale will not go through if value for money cannot be achieved, as the Minister claimed in Grand Committee, when the CSR has already taken into account the revenue that it would generate.
	We have spent a lot of time discussing and debating the notion of value for money, but the Government still refuse to put what they mean by it into legislation. We understand that a precise framework in the Bill would amount to giving away our hand before the game has begun. However, the actual changes we seek to make—an analysis of the current climate and so forth—are the most obvious things to do before any sale takes place. I appreciate the need to protect our interests and ensure value for money by not putting too much commercially sensitive information out in the open. I understand that that would be counter-productive, but not being open about how we determine the benefit to the taxpayer is dangerous.
	Discussions outside the Chamber seem to indicate that the Government might be willing to consider the precepts in our amendment, but to have them applied retrospectively. Indeed, if I understand the position correctly, there is a chance that the Government will table an amendment at Third Reading outlining a value for money framework such as the one we propose in this amendment. It would be published with an assessment of the Government's success in realising value for money one year after the first sale. The assessment would be made by independent bodies and published widely. If the Government would agree to drafting and tabling such an amendment, we would accept the concession and withdraw our amendment. In the mean time, I look forward to the Minister's response.

Baroness Sharp of Guildford: My Lords, I have put my name to this amendment because we on these Benches also believe that it is vital that the Government secure value for money in the sale of these loans and live up to their promises to do so. As I mentioned in Committee, we are talking not of the odd million but of the odd billion. The hope is that we can sell forward part of the current portfolio of student loans and raise, as the noble Baroness, Lady Verma, has mentioned, some £3.4 billion this year. It would not be a bad sale, but what we are losing is not a matter of £10 million, £20 million or £30 million, although during Question Time today the Government said that it was impossible to find £30 million to provide fruit for children in nursery schools. Here we are talking about possibly making a bad sale and losing hundreds of millions, and it is therefore a vital issue.
	We should also be clear about what the alternative is. If the Government do not sell on the portfolio of student loans, or parts of it, they would retain the portfolio for themselves, which, as the noble Baroness, Lady Verma, said, is a major financial asset in their hands. As a result of holding this portfolio, they secure a steady and increasing stream of payments which can help to fund government expenditures in future. They are straightforward repayments. They are not high risk because the repayments are gathered up through the PAYE system by Her Majesty's Revenue and Customs. The Government have lent money today and will receive a stream of repayments in the future. That is the alternative to selling on the portfolio.
	Securitisation, or selling on the portfolio, would mean that instead of receiving a flow of income over time, the Government would take the money today as a lump sum which reflects that future stream of income. The term used is "present value", which is the sum that, if invested today at going rates of interest, would yield a specific stream of income over time. Any present value, therefore, involves an implicit rate of discount. I am not positive but I believe that the Treasury's present rate of discount used in public sector low-risk calculations is in the region of 6 per cent. Any implicit discount higher than this reflects the additional risk factors that come into the calculation. In judging value for money, we are asking whether the implicit rate of discount achieved in the sale is realistic, given the risk.
	Subsection (8)(d) of the amendment states that the Secretary of State shall,
	"assess the proceeds that look likely to be achieved in the transaction using full and clear market information and a comparison with keeping the loans on the Government books, in terms of both likely income flows and levels of risk".
	It seeks that the comparison should be made and that the Secretary of State should ensure that the income likely to be achieved is a better option than keeping the loans on the Government's books. It is important to recognise that it is not impossible to keep the loans on the Government's books and that that may be a better option, certainly in the short term, than selling them off. This is very much the point the noble Baroness, Lady Verma, made.
	Given the state of the market at the moment and the cynicism about the processes of securitisation, quite frankly, what the Government can achieve will not be worth while. The rate of discount gives a much higher value to these risk factors than should be implicit. Securing value for money is about making a judgment about whether you are likely to achieve a rate of discount which is fairly close to the one used by the Treasury or whether the market is offering a rate of discount which at the moment would be regarded as unrealistic. I come back to the fact that we are talking not about the odd million but about hundreds of millions of pounds.
	Having discussed the matter at some length with the Minister and the Bill team, I recognise that some elements of the amendment pose some problems for the Government. For example, it is not necessarily easy to ensure, as proposed new subsection (8)(a) requires, a competitive market for loans. The Minister might find preferable wording such as "the Secretary of State should satisfy himself that there is a competitive market for loans".
	I believe that the Minister is thinking about bringing forward a government amendment. Our proposal makes clear the kind of amendment that we on both sides of the Opposition want to see the Government bring forward. Given the principles the Government laid down about how they would secure value for money, we believe that this is a perfectly reasonable amendment.

Baroness Morgan of Drefelin: My Lords, I hope I can offer the noble Baronesses, Lady Verma and Lady Sharp, some concrete encouragement, in my few remarks here, that we should have a fruitful discussion at Third Reading on this matter.
	As we have heard, the amendment sets out the principles of how to ensure good value for money in any loan sale. The Government are wholeheartedly behind these reasons and endorse them. Indeed, they closely follow the principles that we have placed on the record during earlier stages of the Bill as central to our approach to loan sales. At this stage, however, we need to resist the amendment, and I shall take a few moments to explain that apparent paradox.
	For each sale of student loans there will be a rigorous assessment of value for money. There is no question of a fire sale or of the Government not being prepared to wait. With regard to any continuation of the current market turbulence, as I said in Committee, so far as that turbulence translates into poor value for money of any sales of student loans, we would of course not go ahead with a sale at that time. I stress that again for the record.
	Let me be clear: for the sale of student loans, there will be a rigorous assessment of value for money. If Ministers and the departmental accounting officer judge that a sale at any given time does not represent good value for money, it will not go ahead. That follows the required procedure used in every public sector organisation. We have set out the principles of our approach to value for money. I appreciate the concerns of the noble Baroness, Lady Sharp. We are talking about extremely large sums of money and I recognise the House's concerns about the order of magnitude here, but our view is that these principles should not be translated into a set of statutory tests to be passed in advance of a sale. We think it is right for that judgment to be exercised by the accounting officer and the Government of the day, and for Parliament subsequently to scrutinise that judgment. If, in contrast, we create a set of legal tests to be met before a sale could be deemed lawful, we risk taking that decision away from the accounting officer and Government and taking away the security that Parliament will have to scrutinise the terms of that sale.
	The amendment would significantly increase the level of uncertainty about the sales process for purchasers, something that will undermine the drive for value for money. Purchasers may feel uncertain about the prospect of a judge examining the particular considerations surrounding the sale, finding that the tests had not been set and potentially striking down the sale. Any such uncertainty could deter the purchasers or affect the price they would pay. Far from guaranteeing good value for money, which we are all aiming to achieve, the test in Amendment No. 2 could work against that aim. It would also undermine the responsibility of the accounting officer, which underpins current procedures for protecting public funds from misuse, but I reiterate that we are completely at one on the thrust of what the amendment is trying to achieve.
	Over the long-term programme of sales, we envisage that the Government will be able to draw on the expertise of the National Audit Office evaluation and continuing parliamentary scrutiny to ensure the best possible approach to obtaining good value for money. Establishing a set of tests in primary legislation at the outset—

Baroness Sharp of Guildford: My Lords, does the Minister not agree that on that basis it might be quite sensible, since the securitisation process is new because the previous set of student loans that were sold off were mortgage-style loans and were sold en bloc, to start off with a smaller sale rather than a larger one?

Baroness Morgan of Drefelin: My Lords, as the size of the student loan book grows, there will be tranches. I do not want to compromise any potential sale by saying what size a sale might be, but I understand the noble Baroness's concerns. We are talking about a long-term programme in which a number of sales would take place. We would learn as the sales programmes went forward.

Baroness Sharp of Guildford: My Lords, as I understand it, the programme is for £3.4 billion of sales this financial year, £1.4 billion the next and £1.1 billion the year after that. It would seem sensible to reverse the order and go for £1.1 billion this year to see how it goes and to have the National Audit Office say, "OK, this is a good process".

Baroness Morgan of Drefelin: My Lords, I do not want to prejudice the work of the sales arrangers, but those estimates were put together some time ago for the Comprehensive Spending Review under different conditions. It is not reasonable to say anything other than that the sales arrangers and the accounting officer in the department are committed to value for money, which involves thinking carefully about how the programme is structured and not just about sales as one-off items. It is a programme of sales. How we conduct the first sale will be important in terms of how the market responds. I appreciate the noble Baroness's point. The figures that she quoted are estimates; they are not targets or commitments.
	Over the long-term programme of sales, we envisage the Government being able to draw on expert advice and continuing parliamentary scrutiny to ensure the best possible approach to obtaining good value for money. Establishing a set of tests in primary legislation at the outset would deny the Government the flexibility to learn from the experience of the unfolding programme of sales.
	I am happy to reiterate that the Government will report to Parliament after each sales transaction. If placing a commitment to that effect in the Bill in any way mitigates the concerns of the noble Baroness, Lady Verma, I am prepared to consider further whether the Government could bring forward an appropriate amendment at Third Reading. I hope that we will continue to discuss this important matter. On the basis of that commitment to consider it further, I hope that the noble Baroness will withdraw her amendment.

Baroness Verma: My Lords, I thank the Minister, although I remain cynical about the pressure that the Treasury will use to ensure that the sale goes ahead. I cannot see how a value-for-money framework that ensures that certain conditions are in place will create uncertainty in the market. The noble Baroness, Lady Sharp, eloquently pointed out that the amounts of money involved are not small. Her suggestion of a smaller sale would probably jeopardise the Treasury's demands for much needed funds. However, if the climate is not right, the sale should not go ahead. There seems to be an urgency to get the agreement through. I urge the Minister to consider my amendment, but, for the moment, I beg leave to withdraw it.

Amendment, by leave, withdrawn.
	Clause 2 [Sales: supplemental]:

Baroness Morgan of Drefelin: moved Amendment No. 3:
	Clause 2, page 2, line 32, at end insert—
	"(4A) Transfer arrangements may include undertakings by the Secretary of State about the power to make loan regulations; in particular—
	(a) the Secretary of State may undertake to exercise the power so as to achieve a specified result,(b) the Secretary of State may undertake not to exercise the power so as to achieve a specified result,(c) the Secretary of State may undertake to follow, or not to follow, a specified procedure in connection with the power,(d) the Secretary of State may give undertakings about the indices, information or other matters to be used or considered for the purposes of section 22(4)(a)(i) of the Teaching and Higher Education Act 1998 (c.30) (interest rate to maintain real-terms value of outstanding amounts), and(e) a loan purchaser may enforce an undertaking by way of legal proceedings in public law, private law or both."

Baroness Morgan of Drefelin: My Lords, this group of amendments deals with possible future changes to terms and conditions with regard to student loans. Amendment No. 3 responds to the latest expert advice that we have received from our sales arranger, Deutsche Bank, as I stated in Grand Committee. We now believe that we need to amend the Bill to ensure a durable framework for making loan sales that will yield good value for money. In Grand Committee, the noble Baroness, Lady Verma, asked whether this amendment was about making the sale transaction commercially viable or ensuring that a sale would be a true sale under classification rules. The answer is that it is about both—and rightly so. For the loan sales programme to meet its objectives, it must both enable the Government of the day to get a price for the loans that represents good value for money and remove the loans from the Government's balance sheet, releasing funds to meet government priorities.
	For us to achieve good value for money, potential purchasers must understand what is being sold. Financial institutions are adept at valuing the economic and credit risks that we are seeking to transfer away from Government by selling student loans. They will model how quickly they expect income-contingent repayments to be made, taking into account projections of graduate earnings, unemployment and other macroeconomic factors and demographic factors such as mortality. However, they cannot model the likelihood that Ministers will use their powers to change the conditions of repayment and the predicted cash flows to the special purpose vehicle. That is a political risk, not an economic one, and investors will find it hard to value. If potential purchasers believe that the Government may alter an asset in an unpredictable way after selling it, this will seriously reduce what they will pay.
	The Bill currently gives us one option to address the issue by providing for compensation to purchasers if future policy changes compromise the value of the transferred asset. We have been advised to allow for more than one way to address the issue and that the Government may achieve better value for money if they make undertakings about how terms and conditions may or may not be changed by future regulations. Investors may prefer that kind of certainty over the compensation mechanism and may discount their price to take account of any perceived uncertainties about how compensation may be made. In making their investment decision, they may have placed value on a particular expected size and timing of cash flows, which may be altered by one-off compensation. The amendment also gives some flexibility to cater for changes in the classification rules, which are currently being redrafted by Eurostat. Changes in these rules can have a material impact on the ability to offer compensation. We do not want future Governments to be in a position where their only means of addressing the future policy change becomes something that, under updated rules, prevents a true sale.
	Making undertakings will not be about making changes to improve the lot of the purchaser; it will be about giving certainty about the current position and the Government's intentions over time. If—and I underline the word "if"—the Government use undertakings in sale contracts, they will be made public as part of the sale process. Any changes to the regulations on which undertakings are given would have to be made in advance of the transaction, with usual parliamentary scrutiny.
	If a Government gave undertakings as part of a sale, they would constrain future discretion on policy change affecting those sold loans, although not unreasonably, in that they would be committing only not to change terms in an unexpected way in the middle of a borrower's period of repayment. Terms and conditions will remain as set by regulations and, as we have stated unequivocally, purchasers cannot alter those regulations, which are set by Parliament.
	No borrower will be in a worse position for their loan having been sold and, in developing the amendment on undertakings, we have reflected on the importance of borrowers being fully reassured on that fact. That is why Amendment No. 6 will mean that, when amending the regulations, the Secretary of State must seek to ensure that borrowers will not be in a worse position as a consequence of their loan being sold. If the Bill is enacted, this provision will apply to all changes in regulations after a loan has been sold, not just where an undertaking may have been made. I hope that noble Lords will agree that Amendment No. 6 is a worthwhile strengthening of the statement already on the record and that it will give borrowers confidence that the commitment is intended to stand the test of time.
	I should mention that it has just been drawn to my attention that we will need to make a minor drafting addition to these two amendments, which should mirror the compensation arrangements in Clause 2(4) by covering regulations made under Section 186 of the Education Act 2002 as well as those regulations defined in the Bill as loan regulations. We will table relevant drafting amendments at Third Reading. I flag that up to the House now.
	We are all working to ensure that this Bill provides the most effective framework for a programme of loan sales and that it protects borrowers properly. The amendments in the group represent an important strengthening in both these aspects. I beg to move.

Baroness Sharp of Guildford: My Lords, in Committee I indicated the unease on these Benches at the terms of this amendment. The Government propose the amendment because of advice from Deutsche Bank, their current arranger for the sale of loans later this year, on the mechanism for compensating any change in regulations as set out in Clause 2(4). The Bill states:
	"Transfer arrangements may include provision for the Secretary of State to pay compensation to the loan purchaser to reflect regulations under section 186 of the Education Act 2002 ... (reduction of balances, &c.) ... in connection with amendments of loan regulators, or ... in other specified circumstances".
	The question is whether that provision is sufficient should there be changes in the loan regulations. At present the loan regulations are set. They require that, for example, the threshold for repayment is £15,000. The Government have made it clear that from 2010 that threshold for repayment will rise with the RPI. They also set repayments after the threshold at a marginal rate of 9 per cent of income.
	Our main objection to these amendments is that they tie the hands of any future Government should they wish to change the terms of the repayments. Obviously, the 9 per cent rate of repayment required under the Bill affects a large number of people. The aim is that 50 per cent of the age cohort shall now go to university. Therefore, 50 per cent of young persons will in future be paying back their student loans. As we remarked in Committee, if one aggregates income tax, national insurance and the repayment of student loans, one finds that young people earning £20,000 to £22,000 per year are paying a higher marginal rate of tax than millionaires in this country. It is tough on them in current circumstances, when they are struggling to get into the property market, and a future Government may wish to change those terms in order to make life less tough.
	In discussions with the Minister, it has been made clear that, if the Government were to make changes in such things, those changes would apply only to that block of loans sold. That was reiterated in Committee, when the Minister said:
	"We need to be clear that we are referring to making undertakings about the loans that are sold. For sold loans, it would not be possible for terms and conditions to change in the middle of their repayments".
	This implies that it would be impossible for any future Government to make it easier for those who already have student loans. On the other hand, it would be possible for them to make changes for those getting student loans from that time onwards; they could change the terms of student loans because those purchasing them would know what those changes in terms were. I was slightly concerned because the Minister also talked about,
	"including our commitment to ensure that students whose loans have been sold are not treated less favourably. We need to be clear that future Governments could still change eligibility and entitlement for new loans; for example, the levels of grant and loan, and the income thresholds".
	However, she had said earlier that,
	"we are making specific provision that future changes in loan regulations will apply to sold loans as well as to unsold loans".—[Official Report, 8/5/08; cols. GC 193-98.]
	A degree of clarification is perhaps needed, but I am probably right in assuming that, if regulations were changed, that could apply to future loans but not past loans. We see that in itself as a difficulty.
	Two further difficulties have been raised. The first is the question of classification, involving Eurostat and the Office for National Statistics. How far does simply offering compensation change the terms on which the Government seek to make the sale? Also, is it the case that the Government are not actually selling the loan on because, if they are prepared to offer compensation in this way, it stays on the government books? It is of course important for the Government that, by selling on the student loans, the loans should not remain part of the national debt. Our attitude on these Benches, since we do not have that much sympathy with the amendment anyhow, is to some extent "Tant pis!". However, that does not help the Government much.
	Our final objection to the amendment is that its terms are so wide-ranging. It says, for example:
	"Transfer arrangements may include undertakings by the Secretary of State about the power to make loan regulations; in particular—
	(a) the Secretary of State may undertake to exercise the power so as to achieve a specified result,
	(b) the Secretary of State may undertake not to exercise the power so as to achieve a specified result,
	(c) the Secretary of State may undertake to follow, or not to follow, a specified procedure in connection with the power".
	That is so wide-ranging that we must ask whether we want to give the Government these powers. We object to the amendment on those three grounds.

Baroness Verma: My Lords, this is a crucial amendment. It was debated at length in Grand Committee and we are still hoping for further assurances in the Chamber. I agree with the noble Baroness, Lady Sharp, that it is a wide amendment and does not really answer or cover many of the points that we raised in Grand Committee.
	The Minister said that the original motivation for laying these amendments was,
	"creating certainty for potential purchasers".—[Official Report, 8/5/08; col. GC 198.]
	My understanding is that it allows the Government a wider scope to append conditions to the sale to make certain that purchasers do not have too much unquantifiable risk in the form of a future Government. It seems that the necessity of these amendments was oversight; that is, the first mechanism that was designed to give this certainty to investors was a programme that allowed for compensation should any changes be made. This, according to the Minister, was insufficient to give investors certainty. Can she confirm that this assessment—that the compensation package might mean that the loan book was less attractive—was provided by Deutsche Bank?
	Other discussions revealed another issue that did not seem to preoccupy the Government; namely, whether the Office for National Statistics was able to classify the sale as a genuine sale and a legitimate transfer of risk given that Eurostat is reviewing its guidance. Surely this creates a substantial element of uncertainty. We understand that this guidance often changes. However, if this amendment is really about ensuring increased certainty by allowing for other channels to be considered, does it not make sense to wait until Eurostat has finished revising its guidance? Surely that would enable a clearer picture to emerge of what it is necessary to do to ensure value for money.
	These amendments bring home the point that the Bill is a rushed job. If the Government's intentions are as pure as they claim, why are they rushing through a Bill when the jury is still out on one of its primary mechanisms? Are they legislating for failure? Is the Treasury so desperate for the cash that it does not want to make a decision based on all the best information about the nature of the sale? Although we sympathise with the need to do what it takes to get value for money, this confusion remains a serious worry. Obviously, we will have to wait for precise figures to emerge when a sale is imminent, although we do not know when that will be. All the facts seem to point to a bad result. To cover up for badly managed funds, the Government are planning to sell loans in the worst credit market in history without the benefit of knowing where the goalposts lie. This does not seem to be a situation in which the taxpayer will win.
	Let us be clear: a newspaper headline that read, "Government get good deal on loans in bad markets", would be utterly unacceptable. The point about this enormous asset is that ensuring value for money must not constitute the best course in a bad bunch but the best possible course of action. If the markets seem unwilling to recover, has the Minister considered delaying the sale by, say, two years or so? It is important that she should explain the likelihood of the Government abandoning the sale. Value for money for the taxpayer should be deemed an absolute value in our calculations. I sincerely hope that, during the Government's efforts to ensure that we get it, economists will do the work, not press officers. Telling the public that the loans were sold to protect the taxpayers' interest when the Government might have been able to get a much better deal had they waited would be tantamount to dishonesty. If uncertainty remains in the classification that makes these amendments necessary, why not wait until that uncertainty can be banished and the taxpayer would be better off?

Baroness Morgan of Drefelin: My Lords, I thank both noble Baronesses for their contributions to this thought-provoking debate. I stress that the rationale behind these amendments is very much about creating a process for the sale of the student loans book that will be long-lasting and sufficiently flexible to meet the Government's needs both in the near future and for some years ahead. I do not wish to speculate on how many months or years the first sale of the student loans portfolio might take under the Bill if it is enacted as it would be inappropriate for me to do so. However, the noble Baroness, Lady Verma, is right to be concerned about Eurostat and the review of the guidance. Eurostat is reviewing its guidance, but it may periodically conduct other reviews. So even if we await the outcome of this review, there could be others. That is why the sales arrangers—Deutsche Bank—have advised that it would be appropriate for us to have the possibility of reducing the uncertainty around the sales process, to promote value for money and have the prospect of making the undertakings.
	I understand the concerns of the noble Baroness, Lady Sharp, in principle, but we need to remember that the Government are responsible for policy around student finance. If the Government were to make undertakings to fix the terms and conditions for a student loan that was sold, and if in the future a Government wished to look at the financial circumstances of the cohort of students with sold student loans, there would be many instruments for them to use to do so. Remember that they are not commercial loans but loans providing students with funding, which they then repay in real terms at the same level at which they originally borrowed. The provisions are not unreasonable for a loan so taken out. We are talking about a government process for making it possible for students to take the considerable benefits that a higher education offers and make the most of them. I stress for the noble Baroness that, should a future Government wish to make the financial circumstances of students with sold loans more favourable, many instruments would be open to them to do so, looking at the whole of the student finance and benefit system and whatever other ideas might be at their disposal.
	We are talking about the potential for undertakings specifically for sold loans, not for unsold loans. However, we are also talking about Amendment No. 6, which is important. It seeks to ensure that borrowers will not be in a worse position as a consequence of their loan being sold. That is not just about loans being made following undertakings, but about all loans sold.
	Given the clarifications and commitments that we have made regarding value for money and future options for government, I hope very much that noble Lords will support the amendments. We are ensuring that no student will be adversely affected as a result of their loan being sold, through this group of amendments. I hope that the House will support that.

On Question, amendment agreed to.
	Clause 3 [Onward sales]:

Baroness Morgan of Drefelin: moved Amendment No. 4:
	Clause 3, page 3, line 10, leave out "and (4)(a) and (c)" and insert ", (4)(a) and (c) and (6A)"
	On Question, amendment agreed to.

Baroness Morgan of Drefelin: moved Amendment No. 5:
	Clause 3, page 3, line 29, at end insert—
	"(6A) In entering into transfer arrangements the Secretary of State shall ensure (whether by reliance on subsection (6)(b) or (c) or otherwise) that the Secretary of State will be party to any further transfer arrangements."

Baroness Morgan of Drefelin: My Lords, in Grand Committee, in response to an amendment tabled by the noble Baroness, Lady Verma, I undertook to consider onward sales and how the Secretary of State can ensure that borrowers are protected. We are united in our view that borrower interests must be fully protected in any sales process and beyond. As I said in Grand Committee, the borrower's primary protection lies in the fact that purchasers will not be able to change the repayment terms, which remain governed by regulations. However, we want the added safeguard that the Secretary of State can enforce any protections contained in the sales contract too, such as having access to the same complaints system. That is why subsection (6) enables the initial sales contract, to which the Secretary of State is obviously a party, to contain provisions that make sure that he is also a party to any onward sales contract.
	Although, as I said previously, we think it unlikely that the legal title to the loans will be sold on, we want to be absolutely sure that the Secretary of State can enforce any contractual terms that he might need to in order to protect borrowers. We have listened to noble Lords' arguments and to the points made in another place and we propose an amendment that makes it a requirement that the Secretary of State ensures in the initial sale contract that he is party to any subsequent contract transferring legal title to the loans. We have drafted the amendment in such a way as to enable that to be achieved by either of the contractual devices set out in subsection 3(6)(b) and (c) or by other methods with the same effect.
	I am grateful to the noble Baroness, Lady Verma, for her constructive suggestions as we seek to ensure that borrowers are fully reassured that they are protected. I beg to move.

Baroness Verma: My Lords, my understanding of the amendment is that it would make the Secretary of State party to all onward sales, and I am grateful to the noble Baroness for explaining that. She noted that in the "extremely unlikely" event of an onward sale, the vehicle would change. But in the most unlikely contingencies lurk the most unlikely problems. What would happen if an attempt to purchase the loans was made by a power outside the Secretary of State's jurisdiction? Would that be banned? Would a potential purchaser have to understand that his onward sale capacity would be restricted to this country? The amendment makes the Secretary of State party only to onward sales. Presumably this would not give him or her any power to influence such a decision.
	Essentially the question which must be addressed is to what degree the amendment would restrict the potential of onward transfers. On the one hand, there seems to be the need for a considerable amount of restriction or we risk the loans escaping the Secretary of State's jurisdiction. On the other hand, will this not be used as a bargaining chip to drive down the price? We on this side of the House think that there need to be a fuller explanation of the mechanisms that will ensure this extra control and the likely impact on the nature and price of the sale.

Baroness Sharp of Guildford: My Lords, from these Benches we are pleased to see this amendment. We supported the official Opposition in their previous amendments but, on the whole, we do not share their objections. We feel that this is an adequate amendment.

Baroness Morgan of Drefelin: My Lords, perhaps I may make one point in response to the questions of the noble Baroness, Lady Verma. We need to remember that the whole benefit to the special purpose vehicle of owning student loans is the receipt of revenue from HMRC. Therein lay the Secretary of State's most important lever to ensure that the contracts are honoured and fulfilled. I have said several times that it is extremely unlikely that there would be onward sales, but I appreciate the noble Baroness' concern to have reassurance. We need to be clear that a contract is in place and that all sides are contributing to it. The Government's most important contributions are the revenues. That is what the process of securitisation is about. If another party were not to honour its commitments, there is the other side to it: the payment of revenue from the student loan book which would be balanced against that failure.

On Question, amendment agreed to.
	Clause 4 [Loan regulations]:

Baroness Morgan of Drefelin: moved Amendment No. 6:
	Clause 4, page 4, line 8, at end insert—
	"(6) But in amending loan regulations the Secretary of State shall aim to ensure that no borrower whose loan is transferred is in a worse position, as the result of the amendment, than would have been the case had the loan not been transferred."
	On Question, amendment agreed to.

Bangladesh: Refugees

Baroness Tonge: asked Her Majesty's Government what progress they have made in the negotiations to extend full Bangladeshi citizenship to the Biharis living in refugee camps in Bangladesh.
	My Lords, the liberation struggle leading to the birth of Bangladesh in 1971 was remarkable and successful. The people wanted self-determination; they were a unified group; they fought for it and they won. However, this excluded the Urdu-speaking poor Indians whom we call the Biharis, who were widely regarded by other Bangladeshis as supporters of Pakistan during the liberation war. It is a tragedy that for 40 years they have lived in overcrowded urban slum camps. I am sure that noble Lords will have visited them, as I have, all over the world. They live in appalling conditions. They are reviled by many other Bangladeshis and they have no rights or access to healthcare or education because they are not citizens of Bangladesh.
	I really became interested in this group of people, and became a working trustee of the Dhaka Initiative, because of my interest in the causes of terrorism. All the ingredients are there in these camps: poverty, no education, no future, overcrowding, no status for the people, and a high proportion of young, volatile men in the population with nowhere to go and nothing at all to which to aspire. I remind noble Lords that the UNHCR had looked at this problem but had decided that the Biharis were not refugees according to the Geneva convention and were not stateless under the accepted definition of international law. In other words, they live in limbo, unrecognised.
	The Dhaka Initiative was founded by the late Lord Ennals, and my noble friend Lord McNally has carried on the good work. It has had all-party support from the noble Lord, Lord Glentoran, and the noble Baroness, Lady Blood. Our organiser, Nigel McCollum, whom I cannot praise highly enough for his energy and dedication to the problem, has spent four years fundraising, co-ordinating donors, forcing progress and troubleshooting on the way. He has worked closely with Bangladeshi civil society to formulate a questionnaire on a whole range of issues of concern to Biharis, including, but not only, the questions of where they want to live and who they want to be. He had a lot of help from Professor Quamruzzaman from the Dhaka Community Hospital—in fact, he founded that hospital and was a war hero in the liberation war—and Professor Siddiqui and Professor Abrar from Dhaka University.
	Community workers from the Dhaka Community Hospital who carried out the survey were not aware of its prime purpose, which was to find out the wishes of the Biharis, but they were very well trained and experienced in this type of work. Resistance was met from the Stranded Pakistanis General Repatriation Committee, known as the SPGRC—a group that does tremendous welfare work in the camps and is funded by wealthy sources in the Gulf states and Pakistan. However, the SPGRC maintains that all Biharis want to go back to Pakistan, even though the vast majority have never been there.
	It has to be said that the Biharis are afraid of the SPGRC, and many believe the story that if they accept Bangladeshi citizenship, their homes, such as they are, will be demolished. Therefore, the survey had to be done very discreetly and quietly, and our workers from the community hospital managed to do that. The details of the survey are in the report, which will be published very soon. It revealed that 70 per cent of the Bihari camps were covered by the survey and that 80 per cent of camp dwellers were born after liberation and so could not be accused of fighting for the enemy in the liberation war. It also showed that 1.5 per cent of Biharis in those camps wanted to go to Pakistan, which means that 98 per cent wanted to become Bangladeshi citizens. That 1.5 per cent, out of a total of around 150,000 people in the camps, represents 300 people and, even if they were all given permission to go to Pakistan, that would hardly be a mass movement. However, it is important that the international community recognises those wishes and works with Bangladesh and Pakistan to help those people to go back if they so wish and as requested by the SPGRC.
	During the four years of the project, as I have already mentioned, I visited Bangladesh and the camps in Dhaka. I met all the groups in the camps: the SPGRC, of course, and the Stranded Pakistanis Youth Rehabilitation Movement, which was headed by a very dynamic and vociferous lot of young men, who blamed the UK for lots of things and in particular for forgetting the Biharis. They made hero-worship remarks about Osama bin Laden, confirming my feeling that this was yet another situation in which young people could be persuaded to espouse terrible ideologies. I also met senior representatives of the two main political parties—the BNP and the Awami League—and Jamaat-e-Islami. I want to thank those representatives for their support and for promising to depoliticise the issue and to treat the Biharis' situation as a humanitarian tragedy.
	As I have said, the conditions in the camps are appalling, as are the conditions in those same areas for the ordinary Bangladeshi poor who still live in and among the Biharis. They are as bad as any I have seen anywhere in the third world. We have had discussions with and agreement from the Department for International Development, the European Union and the UN-HABITAT programme to make funds available for the rehabilitation of these areas to benefit both Biharis and Bangladeshis so that there is no ill feeling between the two groups. When I was a member of the Select Committee for International Development in the other place, I saw similar projects in the slums of Calcutta. Such projects can transform lives without actually moving people out of the area that they know.
	This work is urgent. The high court in Bangladesh has ruled that the Biharis should become citizens of Bangladesh and we welcome that after four years of very hard work. We hope that the Government will adopt the ruling, but all will be lost if the international community does not move fast to show the Biharis that the SPGRC is wrong and that citizenship means better living conditions, healthcare and education for their families and that their homes will not be demolished.
	I beg the Minister to follow up on our work and to give the Biharis their self respect and the chance of a decent life in Bangladesh. The matter is so urgent. I look forward to his response.

Lord Dubs: My Lords, I congratulate the noble Baroness, Lady Tonge, on securing this debate and also on her commitment to the cause of the Dhaka Initiative, which we have before us today. Perhaps I may say a little about the late Lord Ennals—I know that the noble Lord, Lord McNally, will want to say something too. I knew David Ennals in the Commons and we were colleagues here, but above all we worked together when I was chief executive of the Refugee Council. I knew very well his commitment to the cause of disadvantaged people. It was second to none. He put himself out enormously for that cause and his commitment to the Biharis was a sign of how he wanted to help disadvantaged people.
	Perhaps I may say a word about my noble friend Lady Blood. She cannot be here and wanted a few words said on her behalf. She was anxious that there should be all-party support for the initiative. Perhaps I may say that I am a demonstration of one-third of that support. She knows all too well that there have been four decades of sectarian conflict because of the situation facing the Biharis in Bangladesh. There were festering wounds, which were perhaps not totally different from those in the Northern Ireland in which she has lived all her life. Her aim all along has been to work on behalf of community reconciliation wherever it may be, so she has been especially keen on support for the cause of bringing Biharis and Bangladeshis together in the way that the report suggests.
	As the noble Baroness, Lady Tonge, said, 98 per cent of Biharis want to remain in Bangladesh, showing a clear commitment to the country in which they have lived for a long time. They have lived in squalid camps for the past 36 years in very difficult circumstances and, as the noble Baroness also said, the vast majority of them were born after the war and conflict that gave rise to their difficult situation in the camps. It is an excellent recommendation that the Biharis be given full citizenship rights. There are still some legal issues to be resolved and one hopes that they will be. The way forward is there.
	International donors have a part to play in helping to achieve the political settlement that will pave the way for full citizenship. Of course it is important that the Biharis, who live in a country where there are many other poor people, are not seen to be given preferential treatment but treated as people who are entitled to certain rights that have been denied to them for all too long. They should be given those in the same way that other people in Bangladesh should be helped to raise their living standards.
	The international community has enormous responsibility in this regard. I am sure that our Department for International Development will live up to that responsibility as, I hope, will the EU and other donors. This is an excellent initiative which will help the lot of some very disadvantaged people.

Lord McNally: My Lords, it is a great pleasure to follow the noble Lord, Lord Dubs. There could be no better person to represent the noble Baroness, Lady Blood, or our mutual late friend, David Ennals. David Ennals was one of my predecessors as international secretary of the Labour Party and I worked with him in the Foreign Office in the mid-1970s. However, it was when I came here to the House of Lords in the mid-1990s that David—as often happens to colleagues in this place—collared me and asked whether I would take some interest in the Biharis. His health was failing at the time and he wanted someone who would carry on the battle. I have to say that at the time I was completely flabbergasted that such a problem existed. It had somehow fallen off the radar.
	I went to Bangladesh with my late colleague Roy Jenkins in the immediate aftermath of the war of liberation. I can confirm what my noble friend Lady Tonge said: it was genuinely a popular war of liberation, but one that, by accident of history, left the Biharis, who had fled India at the time of partition to the refuge—as they saw it—of Pakistan, on the wrong side isolated from a Pakistan many thousands of miles away.
	In the 1990s, I had meetings with the high commissioners for both Pakistan and for Bangladesh. There was no lack of willingness to try to solve the problem—at one stage, there was an attempt at repatriation—but one problem that has bedevilled the whole sub-continent, certainly Pakistan and Bangladesh, was that whenever a Pakistani Government were willing to address the situation of the Biharis, the Bangladeshi regime of the time had other priorities, and when the Bangladeshis were willing to look at the situation, the Pakistanis were involved elsewhere.
	As the noble Baroness, Lady Tonge, pointed out, the problem was not massive on the world scale but a leftover of war with a significant number of people left in limbo. At this point, as she said, Nigel McCollum, a rather remarkable young man, came with the almost revolutionary but blindingly obvious idea of asking the refugees about their problems and what they wanted. As the noble Baroness indicated, however, that was easier said than done in the circumstances. The idea needed financing, support and the boundless energy that Nigel McCollum supplied, but also, as she said, the support at a local level of Bangladeshis of standing who would give the project a fair wind. The noble Baroness has already mentioned Professor Quamruzzaman of Dhaka Community Hospital Trust, Professor Siddiqui of Dhaka University, and Bibi Russell, a Bangladeshi campaigner. This gave local credibility to what was done.
	We were also helped by Max van den Berg, the former chairman of the Dutch Labour Party, and Dame Margaret Anstey, the former UN Under-Secretary-General. That gave us the credibility to go to Governments. To be fair, the Governments of the UK, Australia, Canada, Sweden and the Netherlands, along with Muslim Hands, a British NGO, were willing to put up the money for a survey, which took some years to complete. Throughout this time, we had the steadfast and technical support of the British Council in Bangladesh, to which I pay tribute. We received reasonably large amounts of public money from half a dozen Governments, so it was necessary to have good bookkeeping and some accountability. The British Council underpinned us in that.
	As I said, in some ways the Dhaka Initiative was blindingly obvious. Could we find out what the Biharis wanted, and was what they wanted achievable? As the noble Baroness, Lady Tonge, has indicated, the outcome of the survey, which was conducted by the Dhaka Community Hospital Trust project going from door to door in more than 70 per cent of the camps, was this quite remarkably conclusive result that the overwhelming majority wanted to stay in Bangladesh. How can that be best achieved, and what can HMG do? As the noble Baroness has indicated, here is a real opportunity for the UN, the Commonwealth, the EU and its agencies to put together a plan which, as the noble Lord, Lord Dubs, rightly said, must not be divisive. Bangladesh is an extremely poor country, and we know ourselves from handling problems in this country that any system that seems to give preferential treatment to the needy, however needy they are, can also provoke resentment.
	We want to see plans addressing the problems of refugees in the context of what we hope will be their fellow citizens. It is good fortune that the survey was completed almost at the time when the Bangladesh High Court made this very interesting ruling, which could offer the project ultimate success by combining a good aid package from the international bodies, to which I have referred, with a move by Bangladesh to grant citizenship. That would have international support. If there still is a small minority of people who, through an accident of history, have never been to Pakistan, but who would want to go "back", perhaps Pakistan could help.
	In politics, we sometimes discuss the big issues; for example, how to cure world poverty or how to help refugees. In many ways, this is a small, addressable and soluble problem, which, if it we could solve it, might set an example to other areas in terms of what can be done to settle intractable refugee problems. I look forward to the Front Bench contributions of the noble Lord, Lord Trimble, and the Minister, both of whom in their own ways have special experience of bringing solutions to intractable problems. I hope it gives some comfort to the Biharis and the people of Bangladesh that, when they reflect on this, this Dhaka initiative will have received responses in this House from a Nobel laureate and from a Minister with very distinguished and practical experience.

Lord Trimble: My Lords, I echo what the noble Lord, Lord Dubs, has said. I, too, congratulate the noble Baroness, Lady Tonge, on having arranged for this debate. As noble Lords would expect, I convey an apology on behalf of my noble friend Lord Glentoran who very much hoped to be here but was unable to be. Noble Lords may say that the ensuing act of desperation on behalf of my party resulted in me taking on the role of presenting things in his place.
	The Dhaka Initiative's survey, in particular, is extremely interesting and illuminating. I have no doubt about the figures; although normally when one sees the results of a survey or an election with 98 per cent in one column and 1.5 per cent in another, one suspects that there is more to it than meets the eye. But I find this result credible in view of the history of the situation and the origin of the Biharis, whose forebears come from adjacent parts of India and moved in 1946 and 1947 during partition. Where they expected to have a refuge, they found themselves caught up in another issue and, consequently, now find themselves in a very difficult situation. The survey clearly shows that the Biharis want to integrate into Bangladesh. It is equally clear that the present circumstances mitigate against that happening.
	What leapt out from the initiative report was the simple fact that we are dealing with a group of people who, ethnically, in terms of race and religion, are indistinguishable from the population among whom they are living. The distinction is made by cultural matters, particularly language. But, around language, a sense of community has persisted. Language in itself is not divisive, but it has become aligned with a political issue; namely, what has arisen out of the events of 1971. The years 1947-48 and 1971 may seem a long time ago, but they are not in terms of issues of this nature. Someone who was 20 years old in 1947 is only 81 today and no doubt will vividly relate to his children and grandchildren his memories of that time, while people who are now in their 40s and 50s can clearly remember 1971 and will tell their sons what happened. The sense of identity will be kept alive.
	What is encouraging in the background is how the Bangladeshi courts have handled this issue. One must be glad to see the recent decision of the High Court in Bangladesh which states quite rightly that these people are citizens. Whatever may be the case with regard to individuals, one cannot deprive a community or a group of people of citizenship, any more than one could expel a group of citizens against their will. The court was clearly right to say that they are citizens. The question is whether they are going to be accorded all the rights of citizenship in the state. That is clearly the primary recommendation made by the initiative, and of course there is the hope that behind that recommendation lie the Bangladeshi courts, which one hopes will be able to ensure that the right of citizenship moves from being just a statement to a practical reality.
	I am not in a position to know and I do not know whether the Minister is able to tell us what remedies exist in the Bangladeshi legal system to protect people against discrimination and disadvantage. If there are such remedies, the legal system may well be able to deal with the other aspects of the position of this community without the need for further intervention. It depends very much on the effectiveness of the local legal system as to whether those other disadvantages can be removed.
	I note with interest the recommendations regarding UN-HABITAT's partnership scheme for urban areas and I echo entirely the noble Lords, Lord Dubs and Lord McNally, that it must be handled sensitively so as not to create the impression that this is in some way a privileged group of persons. That is very sensible. Parenthetically, I noted earlier that the recommendations referred to a programme of the Bangladeshi Government to clear illegal slums, which I think is quite unfortunate. Legalising slums is the best way of dealing with them because giving people a legal interest in the property they occupy actually puts them on the first step of the ladder of economic development. They are given an asset against which money can be raised to finance businesses. Countries which have adopted this approach towards so-called illegal slums or shanties have seen that it works in development terms. However, I say that as an aside because it is not properly the subject of this debate. It just happened to touch on one of my hobby horses and I could not resist the temptation to parade it again.
	I conclude, as I began, by congratulating the noble Baroness, Lady Tonge, on securing this debate. It is good to have the issue raised here and, like other noble Lords, I look forward to the contribution of the Minister.

Lord Malloch-Brown: My Lords, I too am grateful to the noble Baroness, Lady Tonge, for raising the important issue of the Biharis of Bangladesh. The noble Baroness and the three noble Lords who have joined her in the debate have spoken movingly of the difficulties facing the Urdu-speaking Bihari people living in Bangladesh. As has been said, in the war of 1971 some Biharis fought on the side of West Pakistan while others remained neutral. They were deemed traitors as a group by the new state of Bangladesh and were initially denied Bangladeshi citizenship. Many left the country, but many remained.
	The United Nations High Commissioner for Refugees estimates that there are now up to 300,000 Biharis in the country. Around half have assimilated and have long been considered de facto citizens. They enjoy full access to public services and jobs, they can apply for passports, and they can own property. It is the other 150,000 who remain in camps first erected after the war on whom our concerns must be focused. The camps are overcrowded, unsanitary and lacking basic amenities and, without citizenship, these Biharis have not been able to vote, own property or travel outside the country. For years they have suffered from discrimination; they have been denied government jobs and access to public health and education. More than a third of these camp residents are illiterate and for most manual labour is the only option. As the noble Baroness, Lady Tonge, said, there is nothing more depressing in this world than to see refugee camps of this kind continuing over several generations and the demoralisation that they bring to all families trapped in this nether land of camps.
	It is a source of great pride for all of us in this House that, at a time when there was little international focus on the plight of the Biharis, some of our colleagues—the noble Baroness together with the noble Lords, Lord Glentoran and Lord McNally, and the noble Baroness, Lady Blood—established an all-party group. I also pay respect to the late Lord Ennals for his role in this area. As has been said, the Dhaka Initiative established a campaign on behalf of the Biharis and its work has played an extraordinary part in advocating for the situation that we have today whereby the curtain is finally being lifted. Due to the initiative's survey of the camps and the subsequent report last year international attention is being drawn to the issue in debates such as this one, and, as we will come to later, progress has been made in the courts of Bangladesh to resolve it.
	I repeat the point made by the noble Baroness, Lady Tonge—that the survey revealed that 80 per cent of camp residents were born after the war and that 98 per cent of them consider themselves to be Bangladeshi. This puts to rest the previously held view that the Biharis considered themselves to be stranded Pakistanis who wished to return to Pakistan, a claim which some camp leaders have propagated for their own political reasons. In fact, only 0.2 per cent of those surveyed—around 300 people—expressed a wish to go to Pakistan, and the vast majority of those wanted to go for reasons of family reunion. That is an important point because it offers a real prospect of a solution which was not possible when it was thought that a large number of people wanted to return to Pakistan.
	As has been said, there have now been positive developments on the legal front. In 2003, the High Court ruled that 10 Bihari residents of a camp were legal citizens of Bangladesh. In September 2007, the Election Commission recommended that all Biharis born after 1971 should be included on the electoral roll and in effect be granted citizenship. This declaration was challenged in the courts, leading to months of confusion, and in practice only those Biharis living outside the camps were able to register on the electoral roll. Those still living in the camps remained excluded. But on 18 May this year, in yet another ruling on this issue, the High Court declared that all Biharis in the country are citizens of Bangladesh. I am sure that all noble Lords will join me in welcoming this latest development.
	The noble Baroness, Lady Tonge, alluded to the fact that some camp leaders do not wish to see an end to the camps. These individuals, all members of the Stranded Pakistanis General Repatriation Committee, have a vested interest, I am afraid, in the continuation of the camps. They have already organised some protests against the High Court's recent rulings. The results of the Dhaka Initiative survey, however, make clear the overriding wish of the vast majority to be integrated into Bangladeshi mainstream society. Our high commission in Dhaka will, as appropriate, work with the Dhaka Initiative to make clear to the Bangladesh Government the findings of its survey and its report. However, I have not lost sight of the fact that there are some 300 Biharis who would like to settle in Pakistan. That is, of course, something for the Bangladesh and Pakistan Governments to resolve, but we will work with the Dhaka Initiative to ensure that they are both aware of the issue and that it is now quantified in a way that makes it much more possible to solve.
	I am glad that our high commission in Dhaka has been able to help with the work of the Dhaka Initiative, including part-funding of its survey. I am grateful to the noble Lord, Lord McNally, for not pointing out that he would have liked rather more from us than he received. I am also glad that the Department for International Development is working with the Bihari community under the Urban Partnerships for Poverty Reduction project in many towns in Bangladesh. The UPPR project, which has been referred to, is a seven-year programme that started last year and to which DfID is contributing £60 million. The aim is to improve the livelihoods and living conditions of 3 million urban poor and extremely poor people, especially women and children, in Bangladesh. The Bihari community will benefit as appropriate from this project. It is an important commitment, which will help Biharis side by side with Bangladeshis in an equal, even-handed way so that there is no resentment. We should also express our appreciation for the tireless efforts of the representative of UNHCR in Dhaka to draw attention to the plight of the Biharis despite the fact that, as was said, they were not deemed to have formal refugee status.
	Some in the Bihari community have expressed concern about the prospect of moving out of the camps and the loss of basic housing and utility provision that that will entail. We need to take those concerns seriously. I have found, over a lifetime of knowing refugee communities well, that perhaps the greatest tragedy of multigeneration life in a refugee camp is the sense of recidivism and dependency that develops. People become afraid of life on the outside. There will therefore be a need for effective transitional arrangements for those who move out of the camps, with an emphasis on housing, health and education and the opportunity of better jobs. The international community should be ready to help the Government of Bangladesh to provide that. Our high commission will be consulting UNHCR on what assistance we might be able to offer. While the initial transition may be difficult for some, the longer-term benefit of Bangladeshi nationality and participation in mainstream society has to make that transition worth while. In reality, most people in the camps recognise fully that any alternative to the indignity of everyday life in a refugee camp must be an improvement.
	This debate has been timely, coming as it does only weeks after the High Court ruling in Bangladesh that all Biharis should be regarded as citizens of Bangladesh. I congratulate all those who have spoken tonight on their support of the Dhaka Initiative and on their important work in pursuit of the Biharis' cause. I commit to this House that, while we appear to be standing on the edge of an enduring solution to this issue, we on these Benches will press the Government of Bangladesh to ensure that the High Court judgment is respected and enacted and will offer all the support that we can to turn it into not only the judgment of a court but the beginning of a programme of closing the camps and reintegrating the Biharis into Bangladesh as full citizens enjoying full rights.

House adjourned at 7.09 pm.